Identifying Key Drivers for a National Transition to Low Carbon Energy using Agent-based Supply Chain Models

Understanding robust pathways to achieve affordable, reliable, and equitable energy transitions to a decarbonized society has received growing attention. While existing energy transition literature emphasizes the role of government policy and technological innovation, little has been written to integrate "top-down" approaches encompassing government policy and "bottom-up" individual enterprise-level decisions. Therefore, here we develop a hybrid top-down, bottom-up production consumption model towards intra-national energy transition planning using a decentralized agent-based approach, including a detailed geographic coverage utilizing GIS to map individual energy units. This enables considering SC-level dynamics of end-users pursuing economic objectives subject to regulatory constraints. Two different case studies are reported. The first study reveals that green hydrogen consumption in the Indian state of Tamil Nadu may grow only up to 3% by 2042 from the current nil usage, even with aggressive technological cost reductions and a fixed carbon price of $20/ton CO2, but demand could grow more rapidly if stringent criteria pollutant emissions limits are imposed. In the second case study, which considers natural gas usage across India, the power and city gas sectors are found to be the consistent demand drivers, with their share rising from -40% of the total in 2022 to -60% by 2032. This is consistent with IEA and IRENA projections. The proposed agent-based model thus provides multiple benefits: It enables the identification of key sectors driving the energy transition; it helps analyze critical factors like resource availability, supply chain infrastructure, and economics; and it can be used to develop decision support tools to investigate clean energy policies.