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726. Reducing Greenhouse Gas Emissions through Strategic Subsidy Allocation for Building Heat Technologies: A bi-level Optimization Approach
Invited abstract in session TC-19: OR in Heating Systems, stream OR in Energy.
Tuesday, 12:30-14:00Room: 44 (building: 116)
Authors (first author is the speaker)
| 1. | Sebastian Lubjuhn
|
| Decision Analysis and Socio-Economic Assessment, RWTH Aachen | |
| 2. | Sandra Venghaus
|
| Decision Analysis and Socio-Economic Assessment, RWTH Aachen |
Abstract
The global population is battling with the urgent need to transition towards sustainable and efficient energy systems. With 15% of the total emissions in Germany, the heating sector is one of the largest greenhouse gas-emitting sectors. Subsidies are key policy instruments governments employ to incentivize the adoption of such technologies. However little research has been done on optimizing these subsidies to achieve the best emission reduction on a long-term horizon. This challenge is compounded by the colliding interests of the German government, which aims to minimize total emissions through subsidy allocation, and property owners, who seek to minimize costs through investments in heating technologies.
While certain heating technologies may offer short-term sustainability benefits, others hold greater potential for long-term emission savings. To address this issue, we propose a bi-level optimization model utilizing a modified grid search at the upper level and linear programming at the lower level to optimize subsidy distribution decisions.
Preliminary findings indicate that subsidies targeting both heating pumps and biomass heating show promise for maximizing emission reduction. Nonetheless, it is observed that additional subsidies for biomass heating entail substantial costs relative to their marginal impact. This underscores the importance of careful subsidy allocation strategies to achieve optimal outcomes in emission reduction efforts.
Keywords
- Energy Policy and Planning
- OR in Energy
- OR in Environment and Climate change
Status: accepted
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