Integration of a computable general equilibrium model with an energy system model: Application of the AIM global model

An integrated assessment model AIM (Asia-Pacific Integrated Model) has been used climate change mitigation studies and the core of AIM is a computable general equilibrium model, AIM/Hub. However, the energy representation in the AIM/Hub is abstract and to overcome that shortcoming, this study integrated AIM/Hub with the energy system model AIM/Technology. First, we assessed how the new integrated model differ from the original standalone AIM/Hub. Second, we conducted the exchange of model outputs iteratively and evaluated how the model results converged. Comparing previous and corresponding iteration, the data points with discrepancies greater than 5% at the third iteration were only 5 variables which were minor variables from the full energy system point of view. The macroeconomic implications of climate change mitigation differ between the standalone AIM/Hub and the new integrated model, and however, there was no systematic discrepancies. Overall, the new model is valid for exploring energy-economic scenarios.