Industrial Process Models
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While application of the econometric approach outlined in the previous sections can give a general indication of how energy demand will evolve in response to fuel prices, it should be noted that this response cannot be stated in terms of specific technological changes, even though it is recognized that for a change in energy demand to occur, some change or modification to production technology must take place. Indeed, proponents of the econometric approach would argue that this is one of the advantages of the approach, in that the effect of technologies yet to be developed can be taken into account (without actually defining them). Of course, for this to be valid, one must suppose that the type of technological response induced by the price changes in the historical period that is subject to the econometric estimation will continue into the future.
KeywordsBlast Furnace Steel Industry Coke Coal Basic Oxygen Furnace Steel Scrap
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- 7.F. Sparrow et al., “The Iron and Steel Industry Process Model,” BNL 51073, Brookhaven National Laboratory, Upton, New York, January 1980.Google Scholar
- 8.Actually the specification of planning horizon in such studies is not a simple matter, because of end effects. If the model considers, say, time steps of 5 years and the planning horizon is, say, 20 years, then it is usual to consider 6 rather than only 4 time periods in the model, so that the end effects in the last period do not distort the result.Google Scholar
- 9.For a good general discussion of the problems of the Iron and Steel Industry in Developing Countries, see e.g., The Iron & Steel Industry in the Developing Countries, Report of the 3rd Interregional Symposium on the Iron and Steel Industry, Brasilia, Brazil, 1973, U.N. Report ID/139.Google Scholar
- 10.All refrence to tonnages in this section are in metric tonnes (1.1023 short tons).Google Scholar