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Coal Market Module (CMM)
Description:
The CMM has three submodules. The Coal Production Submodule
produces supply-price relationships for 12 coal types and 11 producing
regions, addressing the relationship between the minemouth price of coal
and corresponding levels of coal production, labor productivity, and the
cost of factor inputs (mine labor, mining equipment, and fuel). The model
serves as a major component in the National Energy Modeling System (NEMS).
The purpose of the model is to produce annual domestic coal supply curves
for the mid-term (to 2020) for the Coal Distribution Submodule of the
Coal Market Module of NEMS
Coal Distribution Submodule United States coal production,
national and international coal transportation industries. The model is
used to forecast annual coal supply and distribution to domestic markets
Coal Distribution Submodule (International Coal Flows)
The international component of the CDS projects coal trade flows from
16 coal-exporting regions (five of which are in the United States) to
20 demand or importing regions (four of which are in the United States)
for three coal types premium bituminous, low-sulfur bituminous,
and subbituminous. The model consists of supply, demand, trade and transportation
components. The major coal exporting countries represented include: United
States, Australia, South Africa, Canada, Indonesia, China, Columbia, Venezuela,
Poland, and the countries of the Former Soviet Union. The model is used
to forecast international coal trade. It provides U.S. coal export forecasts
to the domestic component of the Coal Distribution Submodule.
Last Model Update:
November 2000
Part of Another Model?
Part of the National Energy Modeling System (NEMS).
Sponsor:
- Office: Office of Integrated Analysis and Forecasting
- Division: Coal and Electric Power Division
- Model Contact: Michael Mellish
- Telephone: (202) 586-2136
- E-Mail Address: Michael.Mellish@eia.doe.gov
Documentation:
- Coal Production Submodule (CPS):
- Energy Information Administration, Model Documentation, Coal
Market Module of the National Energy Modeling System, Part
I, DOE/EIA-M060 (01) (Washington, DC, January 2001)
- Coal Distribution Submodule (CDS):
- Energy Information Administration, EIA Model Documentation,
Coal Market Module of the National Energy Modeling System, Part
II-A, DOE/EIA-M060 (01) (Washington, DC, January 2001)
- Coal Distribution Submodule (CDS) (International Coal Trade):
Archive Media and Installation Manual(s):
See Integrating Module for the National Energy Modeling System (NEMS).
Coverage:
Coal Production Submodule (CPS):
- Geographic: Supply curves for 11 geographic regions
- Time Unit/Frequency: 1990 through 2020
- Product(s): 12 coal types
- Economic Sector(s): Coal producers and importers.
Coal Distribution Submodule (CDS):
- Geographic: United States, including Hawaii, Puerto Rico,
and the U.S. Virgin Islands
- Time Unit/Frequency: Annual forecasts for 1990-2020
- Product(s): Bituminous, subbituminous and lignite coals in
steam and metallurgical coal markets
- Economic Sector(s): Forecasts coal supply to 2 residential/commercial,
3 industrial, 2 domestic metallurgical, 4 export, and 7 electric utility
subsectors (a synthetic fuel subsector is present but not operational
in the CDS) to 13 domestic demand regions.
Coal Distribution Submodule (CDS) (International Coal Flows):
- Geographic: 16 export regions (5 of which are in the United
States) and 20 import regions (4 of which are in the United States)
- Time Unit/Frequency: Each run represents a single forecast
year. Model can be run for any forecast year for which input data are
available
- Product(s): Coking, low-sulfur bituminous coal, and subbituminous
coal
- Economic Sector(s): Coking and steam.
Modeling Features:
Coal Production Submodule (CPS):
- Model Structure: The CPS employs a regression model to estimate
price-supply relationships for underground and surface coal mines by
region and coal type, using projected levels of production, productivity,
miner wages, capital costs of mining equipment, and fuel prices
- Modeling Technique: Three main steps are involved in the construction
of the coal supply curves:
- Calibrate the regression model to base-year production and price
levels by region, mine type (underground and surface), and coal
type
- Convert the regression equation into supply curves
- Construct step-function supply curves for input to the CDS
Coal Distribution Submodule (CDS):
- Model Structure: The CDS uses 35 coal supply sources representing
12 types of coal produced in 11 supply regions. Coal shipments to consumers
are represented by transportation rates specific to NEMS sector and
supply curve/demand region pair, based on historical differences between
minemouth and delivered prices for such coal movements. In principle
there are 8,190 such rates for any forecast year; in practice there
are less since many rates are economically infeasible. Coal supplies
are delivered to up to 18 demand sectors in each of the 13 demand regions.
A single model run represents a single year, but up to 31 consecutive
years (1990-2020) may be run in an iterative fashion. Currently, the
NEMS system provides demand input for the 1990-2020 period
- Modeling Technique: The model utilizes a linear programming
that minimizes delivered cost to all demand sectors
- Special Features:
- All demands are exogeneous to the CDS
- Supply curves (there are 35 supply sources) depicting the U.S.
coal reserve base are exogenous to CDS and are reported in the CDS
from 11 coal supply regions
- CDS currently contains no descriptive detail on coal transportation
by different modes and routes. Transportation modeling consists
only of sector-specific rates between demand regions and supply
curves that are adjusted annually for changes in factor input cost
changes, the producer price index for transportation equipment,
and a time trend
- CDS output includes tables of aggregated output for NEMS system
and approximately 20 single-year reports providing greater regional
and sectoral detail on demands, production distribution patterns,
and rates charged.
- Coal imports are treated as a static input that is subtracted
from demand before solving the CDS. Imports are reported to NEMS
and detailed in some single-year reports
- CDS reports minemouth, transport, and delivered coal prices, coal
shipment origins and destinations (by region and economic sub-sector),
and energy and sulfur content of coal
Coal Distribution Submodule (CDS) (International Coal Trade):
- Model Structure: Satisfies coal import demands at the lowest
cost based on specified supply and transportation costs, and subject
to projected overall levels of available coal export capacities by region
and by coal type
- Modeling Technique: The model is a Linear Program (LP), which
satisfies demands at all points at the minimum overall "world"
coal cost plus transportation cost and is embedded within the Coal Market
Module
- Special Features: The model is designed for the analysis of
legislation concerned with SO2 emissions and trade of nonconventional
coals (subbituminous coals).
Non-DOE Input Sources:
Coal Production Submodule (CPS):
- U.S. Department of Labor, Bureau of Labor Statistics
- Average Hourly Earnings of Production Workers (Coal Mining),
Series ID: EEU10120006
- PPI for Mining Machinery and Equipment, Series ID: PCU3532#
- DRI/McGraw Hill
Coal Distribution Submodule (CDS):
- U.S. Department of Commerce
- U.S. Department of Commerce
- Association of American Railroads (Washington, DC, quarterly)
- AAR Railroad Cost Indices
- Rand McNally and Co. (Chicago, IL, 1988)
- Handy Railroad Atlas of the United States
- Caplan, Abby, et al, eds. (Washington, DC, 1996)
- 1996-1997 Fieldston Coal Transportation Manual
Coal Distribution Submodule (CDS) (International Coal Flows):
- SSY Consultancy and Research, McClosky Coal Information, Ltd., and
the International Energy Agency. Published trade and business journal
articles, including Coal Week International, Energy Publishing, LLC's
International Coal Trade, Financial Times International Coal Report,
and World Coal
- Coal Import Demands
- Coal Supply Curves
- Diversity Constraints
- Ocean Freight Rates
- Sulfur Emission Constraints
- Subbituminous and High-Sulfur Coal Constraints.
DOE Data Input Sources:
Coal Production Submodule (CPS):
- Energy Information Administration, Forms EIA-3, EIA-3A, EIA-5, EIA-5A,
EIA-6A, and EIA-7A
- Historical data for the regression model used for estimating
coal supply curves
- Base year values for U.S. coal production, productivity, and
prices
- Heat and sulfur content averages, and carbon emission factors
by supply curve
- Energy Information Administration, Electric Power Annual 1998,
Volume II (DOE/EIA-0348(99) (Washington, DC, October 1999)
- Base year electricity prices and wages
- Energy Information Administration, State Energy Price and Expenditure
Report 1997 (DOE/EIA-0214(97) (Washington, DC, September 1999).
- Historical electricity prices for the regression model used for
estimating coal supply curves.
- Federal Energy Regulatory Commission
Coal Distribution Submodule (CDS):
- Data Sources:
- Form EIA-3, Quarterly Coal Consumption Report, Manufacturing
Plants
- Form EIA-5, Coke Plant Report Quarterly
- Form EIA-6A, Coal Distribution Report
- Form EIA-7A, Coal Production Report
- FERC Form 423, Monthly Report of Cost and Quality of Fuels
for Electric Plants
- FERC Form 580, Interrogatory on Fuel and Energy Purchase Practices
- Physical: Forecasts of annual coal supply tonnages (and trillion
Btu) by economic sector and subsector, coal supply region, coal Btu,
sulfur content, and demand region
- Demand shares by sector and region: (1) residential/commercial
(trillion Btu); (2) industrial steam coal (trillion Btu); (3) industrial
metallurgical coal (trillion Btu); (4) import supplies (millions
of short tons)
- Coal supply/transportation contracts: (1) coal supply
regions; (2) coal demand regions; (3) coal quality (Btu and sulfur
content); (4) contract annual volumes (trillion Btu); (5) contract
expiration dates (forecast year)
- Coal quality data for supply curves: (1) million Btu per
short ton: (2) lbs. sulfur per million Btu
- Coal quality specifications for regional subsectoral demands
on electricity generation and other sectors
- Economic: Forecasts of annual minemouth, transportation, and
delivered coal prices by coal type, economic sector, coal demand, and
supply regions
- Supply curves relating minemouth prices to cumulative production
levels
- Transportation rates: (1) 1987 dollars per short ton;
(2) specified by subsector, differ by sector; (3) differ also by
supply and demand region pair
- Transportation rate escalation factors: (1) exogenous;
(2) based on estimates of factor input costs (labor, fuel, etc.);
(3) used to adjust for productivity change
- Minemouth price adjustments: (1) can be made by supply
region and forecast year; (2) currently used only by forecast year;
(3) used to escalate and de-escalate transportation rates for forecast
year
- Transportation rate adjustments: (1) can be used by demand
sector and demand region; (2) derived from off-line program that
subtracts base year minemouth costs from delivered costs reported
in Forms EIA-3 and -5, and FERC Form 423 to produce transport rate,
calculates ratio between model rate and rate from forms, preserve
ratio as model parameter; (3) used to calibrate rates in model
Coal Distribution Submodule (CDS) (International Coal Trade):
None.
Computing Environment:
See Integrating Module of the National Energy Modeling System. |