United States Environmental Protection Agency Air and Energy Engineering Research Laboratory Research Triangle Park, NC 27711 Research and Development EPA/600/SR-94/139 December 1994 EPA Project Summary Economic Growth Analysis System: Version 2.0 Terri Young, Randy Randolph, and Daniel Bowman The two-volume report describes the development of, and provides informa- tion needed to operate, the Economic Growth Analysis System (E-GAS) model. The model will be used to project emissions inventories of volatile organic compounds (VOCs), oxides of nitrogen (NOX), and carbon monoxide (CO) for ozone nonattainment areas and Re- gional Oxidation Model (ROM) model- ing regions. The report details the design and de- velopment of E-GAS and includes de- tailed descriptions of the workings of the E-GAS computer modeling software components and external software. The system is an economic and ac- tivity forecast model that translates the user's assumptions regarding regional economic policies and resource prices into Source Classification Code (SCC) level growth factors. The report pro- vides E-GAS users with sufficient back- ground information to define and cali- brate the E-GAS model, as well as the procedures and syntax necessary to operate the system. The organization of the user's manual is determined by the process used in operating the sys- tem, providing images of sample screens as well as text. This Project Summary was developed by EPA's Air and Energy Engineering Research Laboratory, Research Triangle Park, NC, to announce key findings of the research project that is fully docu- mented in two volumes (see Project Report ordering information at back). Introduction On November 15, 1990, the Clean Air Act Amendments (CAAA) of 1990 were signed into law. The CAAA require that extreme, severe, serious, and multi-state moderate ozone non-attainment areas use photochemical grid modeling to demon- strate future attainment with the ozone national ambient air quality standard (NAAQS) [Section 182(e)(2)(A)]. In addi- tion to photochemical grid modeling, the CAAA require that moderate, serious, se- vere, and extreme ozone non-attainment areas submit rate-of-progress (ROP) in- ventories demonstrating a 15% reduction in emissions from 1990 to 1996 [Section 182(b)(1)(A)]. Further, ROP inven- tories for serious, severe, and extreme areas must include demonstration of a 3% reduction (averaged over 3 years) from 1996 until attainment is achieved [Section 182(c)(2)(B)]. Section 182(b)(1)(A) of the CAAA speci- fies that the 15% reduction from baseline emissions accounts for any growth in emis- sions after 1990. A key component of the ROP inventories and photochemical grid modeling demonstrations will be the de- velopment of credible growth factors for the existing inventories. Since growth in source emissions largely depends on the amount of economic ac- tivity growth in an area, a consistent set of growth factors requires forecasts using consistent Gross National Product (GNP) forecasts and a consistent methodology for estimating economic activity in Urban Airshed Model (UAM) and Regional Oxi- ------- dant Model (ROM) modeling regions. The need for consistent economic growth fac- tors, however, must be satisfied in a way that allows states to use their own esti- mates of national and regional economic activity. The Economic Growth Analysis System (E-GAS) is an economic and ac- tivity forecast model which satisfies both of these standards. The existing inventories for ROP dem- onstration and photochemical modeling will be housed in the Aerometric Information Retrieval System (AIRS). E-GAS can be applied to AIRS inventories for the devel- opment of emission projections to 2010, when extreme areas must reach attain- ment. State users can create custom GNP forecasts and may modify input assump- tions for the regional models in the E- GAS system. The system also allows EPA users to develop volatile organic compound (VOC), nitrogen oxide (NOx), and carbon monoxide (CO) growth factors using a single GNP forecast, providing baseline emission growth estimates for comparison with growth factors submitted by the states. The nonattainment areas modeled were chosen on the basis of their nonattainment designation. All serious, severe, and ex- treme areas were modeled, as were multi- state moderate areas. These areas, their designations and area definitions, were announced in the November 6, 1991, Fed- eral Register. To minimize both the number and run time of the models in E-GAS, eight mod- els were developed. Separate models were developed for EPA Regions 1, 4, 5, 6, 7, and 9. In addition, models were devel- oped that combine the areas in EPA Re- gions 2 and 3 and EPA Regions 8 and 10. Each model includes all extreme, severe, serious, and multi-state moderate areas, as well as each state and partial state in the region. E-GAS is a menu-driven system that guides the user through a series of screens which collect information for adapting the model to the user's needs. User input is limited to selecting menu items and set- ting parameters by entering data in text boxes. The E-GAS modeling system contains three tiers. Tier 1 includes available na- tional economic forecasts which are used to drive the regional economic models; Tier 2 includes regional economic models for the UAM modeling areas, as well as the states in the ROM modeling regions; and Tier 3 estimates fuel consumption, physical output, and Vehicle Miles Trav- eled (VMT) based on Tier 2's regional economic forecasts. The tiers must be sequentially executed, since data are cre- ated by and passed from early tiers for transfer to later tiers. The three-tiered struc- ture of E-GAS allows users flexibility in modeling. While tiers must be run before proceeding to later tiers, the system al- lows the models to be rerun at the user's discretion. For example, users may run a variety of national models before perform- ing regional modeling on the last national model run. The National REMI Model allows the user to create a national-level growth pro- jection. It is Tier 1 of the three-part pro- cess of creating estimated growth factors; it generates data to drive the Regional REMI Model (Tier 2). This tier may be rerun any number of times before pro- ceeding to Tier 2. Five national forecasts are available: Bureau of Labor Statistics (BLS), Data Resources, Inc. (DRI), Re- search Seminar in Quantitative Econom- ics (RSQE), Wharton Econometric Fore- casting Associates (WEFA), and user-en- tered Gross National Product (GNP) Data. The Regional REMI Model allows the user to develop a regional growth simula- tion. This is Tier 2 of the three-part pro- cess of creating estimated growth factors; it generates data to drive the Growth Fac- tor Module (Tier 3). In the E-GAS model, more than 100 regular economic policy variables, translator variables, and popu- lation variables can be adjusted. Chang- ing these variables allows the user to simu- late the economic impact of anticipated government policy changes, market changes, or other exogenous changes to the regional economy. These variables are accessed from the REMI EDFS-14 model and offer scenarios for changes in tax rates (corporate profit tax, equipment tax, investment tax, personal income tax, and property tax), costs (including relative pro- duction cost, import cost, and export cost), wage rate, employment transfer payments, purchasing power, and final demand. This tier may be rerun any number of times before proceeding to Tier 3. The Growth Factor Module is the third tier where growth factors are generated and written to files in the \EGAS subdirectory. This module translates changes in the economic activity levels of the most recent regional forecast to growth factors for physical output, fuel consump- tion, and VMT. These growth factors will be developed for two-, three-, and four- digit Standard Industrial Classification (SIC) levels, depending on available data for developing and disaggregating the fac- tors. These SIC-level growth factors will be matched with SCC codes. The user is given a choice of file formats as either the Emis- sion Preprocessor System (EPS) format or an ASCII text file. The file is output by year, county level, and SCC code. E-Gas Reference Manual The Reference Manual provides back- ground information on the design, devel- opment, and implementation of the E-GAS system, as well as information concerning the execution of the system itself. Chapter 1 provides an overview of the system as well as discussions of basic system de- sign and development considerations. Chapter 2 discusses the CAAA require- ments related to the use of photochemical grid modeling in demonstrating future NAAQS attainment and the submission of rate of progress plans that will demon- strate how an area will achieve the 15% reduction in VOC emissions by 1996 vis- a-vis the use of E-GAS. Chapter 3 dis- cusses the current EPA emissions projec- tion guidance and its relationship to E- GAS. Chapter 4 explains the role and use of national and regional economic fore- casts in E-GAS. Chapter 5 discusses how fuel choice is forecast within E-GAS. Chap- ter 6 discusses how electric utility genera- tion is estimated within E-GAS. Chapter 7 discusses how physical output is estimated within E-GAS. Chapter 8 explains the methodology used within E-GAS to fore- cast vehicle miles traveled. Chapter 9 ex- plains, CROSSWALK, the final compo- nent of E-GAS. CROSSWALK assigns growth factors from the other E-GAS mod- ules to point, area, and mobile SCC's. Appendix A lists the data used to develop electric utility generation estimates. Ap- pendix B lists the parameter values by state used in the electric utility module within E-GAS. Appendix C lists the Bu- reau of Labor Statistics codes and SCC matches within CROSSWALK. Appendix D provides an example of the CROSS- WALK output files. E-Gas User's Guide The User's Guide can be used to pilot the user through the E-GAS system. Chap- ter 1 introduces the terminology used with the system as well as the syntax and format of the program and user guide. Chapter 2 discusses the use of E-GAS by explaining the logical progression of the program, presenting sample screens, pro- viding explanations of input formats, and describing the E-GAS utilities found throughout the system. Chapter 3 de- scribes the role of national economic mod- els in E-GAS and the five options avail- able to the user. Chapter 4 explains the general function of E-GAS's policy vari- ables; it then describes the specific vari- ables while explaining their input. Chapter 5 describes the role of model suppres- ------- sions in E-GAS and describes all sup- pressions available to the user. Chapter 6 describes the operation of and data re- quired for the E-GAS National Model (Tier 1). Chapter 7 provides similar descriptions of the Regional Model (Tier 2), and Chap- ter 8 describes Tier 3, the Growth Factor Module. Chapter 9 identifies contacts for further information regarding the opera- tion of E-GAS and the logic of the system. Basic Hardware Requirements The program has been designed for an IBM-compatible personal computer envi- ronment. The system requires the follow- ing minimum hardware configurations: IBM 80386 or 100% compatible personal computer Math coprocessor 580 Kilobytes of Conventional Memory 100 Megabytes of available fixed disk storage VGA graphics capabilities DOS 5.0 or higher 5.25 or 3.5 in. floppy disk drive ------- T. Young, R. Randolph, and D. Bowman are with TRC Environmental Corp., 6320 Quadrangle Dr., Suite 100, Chapel Hill, NC 27514. Sue Kimbrough is the EPA Project Officer (see below). The two-volume report, entitled "Economic Growth Analysis System: Reference Manual, Version 2.0; and User's Guide, Version 2.0," includes paper copy and eight sets of floppy disks (Order No. PB95-501961/AS; Cost: $360.00; subject to change). The set will be available only from: National Technical Information Service 5285 Port Royal Road Springfield, VA 22161 Telephone: 703-487-4650 The EPA Project Officer can be contacted at: Air and Energy Engineering Research Laboratory U.S. Environmental Protection Agency Research Triangle Park, NC 27711 United States Environmental Protection Agency Center for Environmental Research Information Cincinnati, OH 45268 Official Business Penalty for Private Use $300 BULK RATE POSTAGE & FEES PAID EPA PERMIT No. G-35 EPA/600/SR-94/139 ------- |