Research Focus and Methodologies

The cross-disciplinary approach is described by the following dimensions:

• Economic and technical aspects include technical alternatives and feasibility, potential costs and prices, the market and job potential, and possible finance mechanisms.
• Geographical and environmental aspects include land-use conflicts, climate and health impacts, sustainable farming and rural development through bioenergy and other resources.
• Making best use of local municipal and agricultural resources will further trigger interest in renewable energy and reduced carbon emissions.

With this project we will prepare the ground and take first steps towards a sustained research effort that focuses on two interrelated cross-cutting issues which are pursued in parallel. The key thrust is to undertake two interrelated efforts:

• Design and implementation of steps towards the development and integration of renewable energy generation and fossil fuels displacement in Illinois, including a comparison of wind power, bioenergy, conservation, efficiency gains and waste management.
• Integrated assessment of renewable resources, including the potential of emission reductions, options and impacts of land use and carbon storage in Illinois, by integrating methodologies from economics, systems analysis, spatial and climate modeling.

Steps towards implementation of renewable energy

This project provides a framework to examine the availability, feasibility and economics of alternative energy sources in Illinois, including renewables, waste management, energy efficiency and conservation. In particular, the potential for wind energy and bioenergy for electricity generation is studied. Biomass plays a key role due to its multiple roles in land use and land cover change, energy, food production and waste management, for carbon storage and climate change. Biomass offers a variety of energy uses, including electricity production, incineration, biogas and biofuels (ethanol, biodiesel). To study the role of biomass in the region’s energy supply, yield and carbon sequestration data from corn, soy, wheat stover, switchgrass and Miscanthus are collated, and potential supply, costs and barriers as well as environmental impacts are compared. A lead in biomass at Illinois has been provided by its research on Miscanthus which due to its low input and high yield could significantly contribute to the region’s energy supply.

Emphasis will also be on identifying more efficient uses of biowaste from agricultural, industrial and municipal sources. At the same time this would reduce problems of environmental pollution and landfill management and would support a transformation towards bioenergy by further creating an infrastructure for systematic and large-scale production of biogas, biofuels and biomass which can replace fossil fuels (e.g. through alternative fuels and coburning plants). The impact of market forces and regulation are examined, in light of rapid changes in the electricity business (Gross 1996). The significant impacts in the congestion of the grid (Bompard et al. 2003) and the difficulty of developing incentives for the improvement of the transmission grid (Oren et al. 2002) are some of the key issues in the integration of renewable resources into the grid. Demonstration projects can support the transition from local area heat and power to large-scale electricity generation and cost-effective transportation to power plants to displace coal.

Based on this assessment, incentives are examined to achieve optimal sustainable land uses that are compatible with environmental and societal evaluation criteria. These incentives could be through energy policies, such as targets for future renewable energy use, similar to the Renewable Portfolio Standard for Illinois that sets targets for the share of electricity to be generated through renewable energy in the next ten years. Incentives could also be provided through limits on carbon emissions from power plants or subsidies for switching to renewable fuels. Additionally, these incentives, particularly for biomass crops, could also be provided through the conservation policies of the government.

Energy and conservation policy can stimulate sustainable land use and renewable energy production. Land that is idled from crop production can be used to grow biomass which can not only increase carbon sequestration but also provide other environmental benefits such as reduced sediment and chemical run-off. Allowing farmers to produce legitimate commercial crops on retired lands, as long as the same environmental goals are achieved, would reduce budgetary burdens on government and present a win-win situation. An additional incentive is the creation of jobs from renewable energy in Illinois. This approach can only work if there are established markets for biomass crops and power plants have incentives to produce electricity with renewable energy. Thus, both energy policy and conservation policy have to operate hand in hand to encourage renewable energy production.

Integrated Assessment of renewables and land use

A significant aspect is to examine the adequate pattern of land allocation among competing uses in Illinois under various goals for renewable energy generation and carbon mitigation, based on suitable model instruments. The productivity, cost effectiveness and transportation requirements of renewable resources in Illinois will be studied by use of spatial dynamic modeling combined with data from Geographic Information Systems (GIS) on land quality, climate and land use. Existing instruments are the Regional Economics Applications Laboratory (REAL), the Land Use Evolution and Assessment Model (LEAM) and the Spatial Modeling Environment (SME) that allows inclusion of cellular graphical models such as Stella (Hannon/Ruth 1997, 1999, Costanza/Voinov 2004). The project explores the potential contribution of land-use activities to future emissions and mitigation strategies to explicitly account for 1) competition for land across sectors; 2) relative costs and benefits of emissions reductions between energy and land use; and 3) dynamics of land availability, climate change feedbacks and land use. A spatially disaggregated analytical model is combined with GIS data on land quality, climate and land use to examine the environmental and economic impacts of alternative sources of renewable energy. We study areas where it may be profitable to switch to bioenergy production and areas where wind energy has greater economic potential. The potential is assessed to grow perennial grasses in Illinois that can provide bioenergy, in particular areas where Miscanthus can be grown productively and it would be cost-effective to transport it to power plants to displace coal for electricity generation.

The biophysical and climate model component is based on the Integrated Science Assessment Model (ISAM), which consists of state of the art representations of all major greenhouse gas cycles, land use change, atmospheric chemistry, radiative forcing, and climate change. A version of ISAM has been used in recent and past assessments of the Intergovernmental Panel on Climate Change for projecting long-run consequences of global emissions and concentration scenarios and resultant climate change. Various components of the ISAM are well calibrated and validated with observed data and the model detailed description and its applications have recently been published in international peer-reviewed journals (see Jain/Yang 2005; Jain/Cao 2005; Jain et al. 2005; Cao/Jain 2005; Tao/Jain 2005; Jain et al. 2006). Using ISAM in a regional context allows integration of spatial, climate, economic and technical factors in a joint modeling framework in which key tradeoffs and feedbacks are efficiently and consistently represented.

To provide a tool for decision-making in multi-actor environments, the project builds on dynamic games and agent-based modeling approaches developed for applications in economic and environmental management (Scheffran 2000, 2002, 2006, Scheffran/Pickl 2000, Scheffran/Leimbach 2006, Ipsen et al. 2001, Billari et al. 2006). Connected to ISAM and spatial modeling, agent-based modeling allow to develop a set of reference, no-policy emissions scenarios, including emissions from land use change for Illinois; and to develop a set of policy scenarios in which mitigation occurs relative to reference scenarios. These mitigation scenarios will compare the costs of mitigation with and without reductions in land use emissions. This cost difference quantifies land use reductions and is compared to existing cost estimates of accomplishing similar reductions. The approach facilitates involvement of stakeholders in model development, criteria setting and validation (mediated modeling, van den Belt 2004) and using the results for investment and project support by policy-makers, firms, farmers and finance institutions.