System dynamics modelling to assess the impact of renewable energy systems and energy efficiency on the performance of the energy sector

Abstract

Sustainable development of the inherently complex nature of the energy sector requires a comprehensive understanding of its components and their dynamic interactions. In this study, we employ a system dynamics approach to examine the impact of renewable energy systems and energy efficiency on the performance of the energy sector, and apply this, as a case study example, to the Australian energy sector. Our results show that improving only 1% of energy efficiency would result in 101k/331k GWh energy productivity (5% and 14% of total energy consumption) and reduce domestic CO2 emissions by 15.3/50 Mt CO2-e (4% and 10% of total domestic emissions) by 2030/2050. Switching to renewable energy for transportation and therefore saving 5% per year of current oil consumption may decrease dependency on oil to half by 2030 and to zero by 2050, and reduce domestic CO2 emissions by 74.1/198 Mt CO2-e (18% and 41% of total domestic emissions). Switching to renewable electricity by 3% annually may lead to 60.8/129 Mt CO2-e reduction in domestic CO2 emissions (15% and 27% of total domestic emissions) by 2030/2050. Electrification of other sectors, mainly the manufacturing sector, increasing the use of renewable energy by 4% annually, may lead to 43.3/106 Mt CO2-e reduction in domestic CO2 emissions (11% and 22% of total domestic emissions) by 2030/2050. Improving energy efficiency, switching to renewable energy for transportation, switching to renewable electricity, electrification of sectors that do not currently run on electricity with the use of renewable energy could achieve zero domestic CO2 emissions by 2050 while energy consumption stays almost stable (0.5%/year). This process may be accelerated by improving energy efficiency by more than 1%.