The Stanford pilot energy/economic model

PILOT is a U.S. national energy/economic model that compares various policy decisions by measuring their impact on the standard of living. Through its dynamic linear-programming formulation, the modeled economy allocates industrial output to consumption and to capital formation in the current period to achieve the highest standard of living over the planning period. The ''take home'' or consumption income is used to measure the standard of living. The model consists of a detailed description of energy technologies and a less-detailed description of other economic sectors, investments, government, and final consumption. In particular, there is an explicit representation of the exploration and extraction processes for oil, gas, and uranium; there is an accounting over time of reserves and capital formation. Foreign trade balance is treated endogenously. Final consumption is represented by consumption vectors that vary with increasing level of income. Three sets of input conditions are used to illustrate the behavior and capabilities of the model. The assumptions for the base case and two variations were developed. One of the cases assumes a higher and another a lower availability of primary energy than that assumed for the base case. The general conclusion on the supply side is that the availability ofmore » primary energy can have an important effect on the future standard of living. On the demand side, successful implementation of conservation measures can significantly increase the standard of living for the same amount of energy made available to the general economy. The model outputs are schedules of economic activity, imports and exports, raw energy extraction, new construction, and production of various conversion processes.« less