Raffaele Salvucci presented a methodology for modeling transport modal shift in TIMES energy system models using elasticities of substitution. The methodology was implemented in the TIMES-DKEMS model which includes a transport sector for Denmark. Testing showed that introducing an elasticity of substitution of -3 resulted in over a 25% shift from cars to other modes by 2050 to meet emissions targets. Further work will explore characterizing elasticities for different transport aggregates and applying the approach to model freight and the Nordic region.

1. Modelling transport modal shift in
TIMES models through elasticities
of substitution
Raffaele Salvucci, PhD student
Energy System Analysis Group
Technical University of Denmark
rafs@dtu.dk
Supervisors: Kenneth Karlsson (DTU),
Co-supervisor: Maurizio Gargiulo (E4SMA),
Co-supervisor: Tanu Priya Uteng (TØI)
November 2018, Stuttgart

2. 2 DTU Management, Technical University of Denmark Stuttgart, November 2018
Agenda
•Context - PhD Project
•Methodology Description: TIMES-DKEMS model
•Further perspectives
Raffaele Salvucci, Jacopo Tattini, Maurizio Gargiulo, Antti Lehtilä,
Kenneth Karlsson. Modelling transport modal shift in TIMES models
through elasticities of substitution. Applied Energy, 2018; 232:740-
751.
https://doi.org/10.1016/j.apenergy.2018.09.083

3. 3 DTU Management, Technical University of Denmark Stuttgart, November 2018
PhD Project
•Analyse and Identify effective policies for a low-
carbon Nordic transport sector up to 2050.
•Develop and apply tools that integrate poorly
understood factors as: modal shifts, fuel options,
and consumer behaviour into scenario modelling.
PhD
• Develop and test an innovative transport sector description
• Apply the developed tool for testing transport policies within a
scenario analysis framework
Context TIMES-DKEMS Future

4. 4 DTU Management, Technical University of Denmark Stuttgart, November 2018
TIMES-DKEMS
Context TIMES-DKEMS Future
•TIMES-DKEMS stands for TIMES-DK
equipped with Elastic Modal Shift
•TIMES-DK: full Danish energy system
including: supply, power and heat,
industry, residential and transport.
•TIMES-DKEMS includes the
standalone inland transportation
sector of TIMES-DK and a simplified
supply sector
Olexandr Balyk et al., 2018. TIMES-DK: technology-rich multi-sectoral
optimisation model of the Danish energy system. Under review
Geographical representation of TIMES-DK

5. 5 DTU Management, Technical University of Denmark Stuttgart, November 2018
Transport Sector in TIMES-DK
Extra Short: < 5 km
Short: 5-25 km
Medium: 25-50 km
Long: > 50 km
• Exogenous travel demands are defined
for each mode, for the whole time
horizon
• Several technologies that use different
fuels compete to fulfil each exogenous
modal demand
Context TIMES-DKEMS Future
• Technologies can compete within
modes but not between modes.
• Solution contributing to the lowest
system cost is selected
• Travel Patterns:
Car %
XS 6
S 30
M 22
L 42

6. 6 DTU Management, Technical University of Denmark Stuttgart, November 2018
Modelling Modal Shift
?
Modal shift involves the growth in the demand of a transport mode at the expense
of another. Modal shift occurs due to change in modal costs, speed, reliability, etc..
Modal Shift in TIMES models:
1) Introducing new dimensions such as travel time and speed (Tattini, 2017; Pye,
2015; Daly, 2014; etc.)
2) Consumers heterogenity of modal/vehicle perception (Tattini, 2017; McCollum,
2016; Bunch, 2015; Ramea, 2016; etc.)
Elasticity of Substitution
• Pro: simple way to include modal shift into TIMES models, requires less data
compared to other methods
• Cons: It simplifies a lot the modal shift dynamic, difficulties in finding “real”
suitable elasticities values
Context TIMES-DKEMS Future

7. 7 DTU Management, Technical University of Denmark Stuttgart, November 2018
Own-Price Elasticity in TIMES
𝐷
𝐷0
=
𝑝
𝑝0
𝜎
𝑫 𝟎
; 𝑷 𝟎
: reference demand and
shadow price for an energy
service, obtained by solving
TIMES for a reference scenario
𝜎 is the (negative) own-price
elasticity of the energy service
demand
Shadow prices can vary due to the
introduction of e.g. an
environmental policy (CO2 tax, fuel
tax, etc.) or target (CO2 bound)
Context TIMES-DKEMS Future
Demands self-adjust in reaction to changes of their
own-price (relative to the reference case)
𝐷 = 𝐷0
−
𝑗=1
𝑚
𝑠𝑚𝑗 +
𝑗=1
𝑛
𝑠𝑛𝑗

8. 8 DTU Management, Technical University of Denmark Stuttgart, November 2018
Elasticity of Substitution
Elasticity of Substitution have been introduced in TIMES (TIMES Micro) by Antti
Lehtilä, based on previous work by R. Regemorter and G. Goldstein.
Context TIMES-DKEMS Future
• 𝝈 𝒌 is the same for each component demand
• Aggregate volume is preserved after substitution (Volume-preserving variant)
• Unitary substitution rates: 1 Mpkm of rail substitutes 1 Mpkm of car

9. 9 DTU Management, Technical University of Denmark Stuttgart, November 2018
Extra Short: < 5 km
Short: 5-25 km
Medium: 25-50 km
Long: > 50 km
• One aggregate for each
distance category with
specific elasticity of
substitution
• Volumes of aggregates
are kept constant
Context TIMES-DKEMS Future
Transport Sector in TIMES-DKEMS

10. 10 DTU Management, Technical University of Denmark Stuttgart, November 2018
Year 2020 2025 2030 2035 2040 2045 2050
CO2 emission
bound (Mtonnes)
10 7.5 6.5 5.8 5 4.5 0
• Environmental target: bound on CO2 emissions over the time horizon.
• 𝝈 𝒌 = −𝟑; ∀𝑘, ∀𝑡
Year 2020 2050
Car - 25 % ; + 0 % - 100 % ; + 0 %
Other modes* - 25 % ; + 25 % - 100 % ; + 100 %
Obtained from the Danish Travel Survey (TU survey).
• Modal shift potentials (∆) over the time horizon. They are equal across
distance range class k.
Test assumptions
Context TIMES-DKEMS Future
• Modal shift is allowed from 2020 on.

11. 11 DTU Management, Technical University of Denmark Stuttgart, November 2018
𝜎 = −3
Inland Passenger Modal Share in 2050
Context TIMES-DKEMS Future

12. 12 DTU Management, Technical University of Denmark Stuttgart, November 2018
Modal Shift by Distance Range Class
Context TIMES-DKEMS Future

13. 13 DTU Management, Technical University of Denmark Stuttgart, November 2018
Total modal shift for different 𝝈
Context TIMES-DKEMS Future

14. 14 DTU Management, Technical University of Denmark Stuttgart, November 2018
Further Perspectives
• Continue testing the methodology under
different set-ups: characterise substitution
elasticity for each aggregate, or even for each
mode in each aggregate.
• We are currently applying the methodology to
model freight modal shift.
• Apply it for transport scenario analysis in the
Nordic region.
• Lastly, the use of substitution elasticities (TIMES
Micro) could potentially be applied in other
sectors with similar dynamics.
Context TIMES-DKEMS Future

15. 15 DTU Management, Technical University of Denmark Stuttgart, November 2018
Thank you for your attention, any
questions?
Raffaele Salvucci, PhD student
Energy System Analysis Group
Technical University of Denmark
rafs@dtu.dk
Supervisors: Kenneth Karlsson (DTU),
Co-supervisor: Maurizio Gargiulo (E4SMA),
Co-supervisor: Tanu Priya Uteng (TØI)