The Project Independence Evaluation System And Its Applications To Energy Policy Issues

The Project Independence Evaluation System (PIES) is a complex evaluation, forecasting, and analysis system which represents the U.S. energy production, conversion, transportation and consumption activities. The system includes various models: An econometrically estimated energy demand model, used to evaluate the final demand functions for energy commodities ; A collection of supply models, used to evaluate the cost curves or supply curves for domestic crude oil, natural gas, coal ; An integrating model used to describe energy conversion and transportation activities and to calculate prices which equate energy supply and demand in each market. PIES has been used to generate conditional forecasts of the 1980, 1985, and 1990 states of the energy system--forecasts conditional upon the world oil prices, the energy policy environment, and other uncertainties. Scenarios have been structured to separately examine conservation initiatives, domestic energy supply enhancements, an extensive electrification strategy, and oil and natural gas well -head price regulation. This paper presents the basic model, discusses its use for examining policy options, and describes several forecast results. The paper draws heavily upon work completed for the 1976 National Energy Outlook, published by the Federal Energy Administration.