Environmental Economics

NERA Proprietary Models

NERA has an extensive collection of proprietary models that have been developed to assist in the economic evaluation of climate change and other environmental policies.

• The N_ewERA model
• A program that models the US electric power system and portions of the Canadian system, with 39 geographical regions that reflect the interplay of transmission constraints and environmental regulations. Linking this model with the general equilibrium model described below allows for the analysis of unit-level impacts while accounting for the economy-wide impacts of environmental regulation resulting from climate and other emissions policies.
• A computable general equilibrium model of all sectors of the US economy that simulates patterns of investment and consumption behavior that maximize consumer welfare over time. It captures changes in electricity demand and natural gas and oil prices that cannot be evaluated without modeling the entire US energy sector. 
• The NERA Carbon Financial Impacts Model combines projected market impacts of climate change policies with company- or sector-specific data on emissions, energy consumption, output, and other factors to estimate changes in costs and revenues.
• The NERA Stochastic Electricity Market Model analyzes the effects of various changes on generation asset values.
• The NERA Light Duty Vehicle Market Model analyzes the effects of various policies (e.g., fuel economy and emission standards) on new vehicle sales, existing vehicle scrappage rates, fleet populations, fuel use, and emissions.

NERA also develops specific proprietary models to meet individual client's needs. Recent examples include:

• a model of the US refining sector to study the impacts of a national climate change program;
• a model to evaluate sector-specific carbon abatement options in the electricity, refining, and oil and gas sectors within a particular state;
• a model of the US pulp and paper sector to study abatement opportunities for various air emissions;
• a model of international air traffic to assess the impact of the EU ETS on airlines;
• a model of the UK heat market to assess the cost and potential for renewable heat; and
• models of individual EU industries, including petrochemicals and lime, to assess the competiveness effects of climate change policies.