Energy system

The first two definitions allow for demand-side measures, including daylighting, retrofitted building insulation, and passive solar building design, as well as socio-economic factors, such as aspects of energy demand management and remote work, while the third does not. Neither does the third account for the informal economy in traditional biomass that is significant in many developing countries.

The analysis of energy systems thus spans the disciplines of engineering and economics. Merging ideas from both areas to form a coherent description, particularly where macroeconomic dynamics are involved, is challenging.

The concept of an energy system is evolving as new regulations, technologies, and practices enter into service – for example, emissions trading, the development of smart grids, and the greater use of energy demand management, respectively.

Treatment

From a structural perspective, an energy system is like any system and is made up of a set of interacting component parts, located within an environment. These components derive from ideas found in engineering and economics. Taking a process view, an energy system "consists of an integrated set of technical and economic activities operating within a complex societal framework". The identification of the components and behaviors of an energy system depends on the circumstances, the purpose of the analysis, and the questions under investigation. The concept of an energy system is therefore an abstraction which usually precedes some form of computer-based investigation, such as the construction and use of a suitable energy model.

Viewed in engineering terms, an energy system lends itself to representation as a flow network: the vertices map to engineering components like power stations and pipelines and the edges map to the interfaces between these components. This approach allows collections of similar or adjacent components to be aggregated and treated as one to simplify the model. Once described thus, flow network algorithms, such as minimum cost flow, may be applied. The components themselves can be treated as simple dynamical systems in their own right.

Economic modeling

Conversely, relatively pure economic modeling may adopt a sectoral approach with only limited engineering detail present. The sector and sub-sector categories published by the International Energy Agency are often used as a basis for this analysis. A 2009 study of the UK residential energy sector contrasts the use of the technology-rich Markal model with several UK sectoral housing stock models.

Data

International energy statistics are typically broken down by carrier, sector and sub-sector, and country. Energy carriers (aka energy products) are further classified as primary energy and secondary (or intermediate) energy and sometimes final (or end-use) energy. Published energy datasets are normally adjusted so that they are internally consistent, meaning that all energy stocks and flows must balance. The IEA regularly publishes energy statistics and energy balances with varying levels of detail and cost and also offers mid-term projections based on this data. The notion of an energy carrier, as used in energy economics, is distinct and different from the definition of energy used in physics.

Scopes

Energy systems can range in scope, from local, municipal, national, and regional, to global, depending on issues under investigation. Researchers may or may not include demand side measures within their definition of an energy system. The Intergovernmental Panel on Climate Change (IPCC) does so, for instance, but covers these measures in separate chapters on transport, buildings, industry, and agriculture.

Household consumption and investment decisions may also be included within the ambit of an energy system. Such considerations are not common because consumer behavior is difficult to characterize, but the trend is to include human factors in models. Household decision-taking may be represented using techniques from bounded rationality and agent-based behavior. The American Association for the Advancement of Science (AAAS) specifically advocates that "more attention should be paid to incorporating behavioral considerations other than price- and income-driven behavior into economic models [of the energy system]".