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Behavioral change in MESSAGE-Access

MESSAGE-Access is a least-cost optimization variant of the MESSAGE model that provides a detailed representation of energy use for the residential sector in developing country regions. It is fully integrated with the MESSAGE supply side model, but not in call scenarios is the the detailed demand-side representation used, but instead a more aggregated formulation with just seven demand categories is used (see Demand - MESSAGE) which is parametrized off the detailed MESSAGE-Access formulation. The objective function maximizes household utility by choosing an energy-equipment combination for an individual household group that meets a particular energy service demand at lowest cost. The model is calibrated with data on existing household energy use patterns, derived from national household surveys and energy statistics and balances for the base year 2005. Assumptions regarding urbanization, income growth and changes in income distributions over time drive the model outcomes in the future. In its current version the model is implemented only for 3 of the 11 MESSAGE regions, SAS, PAS and AFR, that are developing regions where access to modern energy remains the most limited.

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The methodology for modeling energy choices in the residential sector using this model is described in detail in Ekholm et al (2010) and in the Supplementary Materials section of Pachauri et al. (2013). In addition to energy prices, technology costs and performance parameters, and income level of a household determining the least-cost energy-equipment combination that meets a specific energy need, two additional parameters determine choices in the model. The first is referred to as the “inconvenience cost”. An inconvenience cost is a cost related to the inconveniences associated with obtaining and using certain types of fuels. For example, gathering firewood involves an opportunity cost for the time spent in collecting it and a dis-utility to users from exposure to the smoke they inhale when it is combusted. This non-monetary cost is captured by estimating an inconvenience cost (see Ekholm et al. 2010 for further details regarding the methodology) for each household group and fuel. This is considered an additional cost that must be taken into account by the household in making a decision regarding the choice of fuels. The second parameter that also determines energy choices for households is income dependent implicit discount rates that determine the annualized capital costs of equipment depending on their individual lifetimes.

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Figure 2.3: Split of residential energy demand into different spatial (urban/rural) and income (1-5) categories.