World Energy Projection System Plus Model Documentation: Commercial Model
December 19, 2017
Introduction
The Commercial Model of the World Energy Projection System Plus (WEPS+) is an energy demand modeling system of the world commercial end-use sector at a regional level. This report describes the version of the Commercial Model that was used to produce the commercial sector projections published in the International Energy Outlook 2017 (IEO2017). The Commercial Model is one of 13 components of the WEPS+ system. The WEPS+ is a modular system, consisting of a number of separate energy models that are communicate and work with each other through an integrated system model. The model components are each developed independently, but are designed with well-defined protocols for system communication and interactivity. The WEPS+ modeling system uses a shared database (the “restart” file) that allows all the models to communicate with each other when they are run in sequence over a number of iterations. The overall WEPS+ system uses an iterative solution technique that forces convergence of consumption and supply pressures to solve for an equilibrium price.
This report documents the objectives, analytical approach and development of the WEPS+ Commercial Model. It also catalogues and describes critical assumptions, computational methodology, parameter estimation techniques, and model source code. This document serves three purposes. First, it is a reference document providing a detailed description for model analysts, users, and the public. Second, it meets the legal requirement of the Energy Information Administration (EIA) to provide adequate documentation in support of its models (Public Law 93-275, section 57.b.1). Third, it facilitates continuity in model development by providing documentation from which energy analysts can undertake and analyze their own model enhancements, data updates, and parameter refinements for future projects.
Model summary
The WEPS+ Commercial Model for the IEO2016 projects energy consumed by businesses, institutions,
and service organizations. Commercial sector energy use covers a broad range of activities and services
and includes energy used in schools, stores, correctional institutions, restaurants, hotels, hospitals,
museums, office buildings, banks, and sports arenas. Most commercial energy use occurs in buildings or
structures, supplying services such as space heating, water heating, lighting, cooking, and cooling.
Energy consumed for services not associated with buildings, such as for traffic lights and city water and
sewer services, is also categorized as commercial energy use.
The Commercial Model projects commercial consumption for 11 energy sources in each of the 16 WEPS+ regions on an annual basis over a projection period. The model primarily uses a dynamic econometric equation for the key energy sources, basing the projection on assumptions about future growth in gross domestic product (GDP), commercial retail energy prices for nine fuels, and a trend factor. The dynamic equation uses a lagged dependent variable to imperfectly represent stock accumulation. The GDP and price projections are available to the Commercial Model from the WEPS+ Macroeconomic Model and the supply models through the restart file, which is shared by all WEPS+ models. The trend factor is meant to represent continuing impacts on energy use not directly represented in GDP and price, and may include a variety of behavioral, structural, and policy-induced activities. The consumption projections generated by the Commercial Model are in turn put into the restart file for use by other models.
Model archival citation
This documentation refers to the WEPS+ Macroeconomic Model, as archived for the International
Energy Outlook 2017 (IEO2017).
Model contact
David Peterson
U.S. Energy Information Administration
United States Department of Energy
1000 Independence Avenue, SW
Washington, D.C. 20585
Telephone: (202) 586-5084
Email: David Peterson