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What I will talk?

A Simple Parallel Projection Optimization Algorithm Estimating a Large-size Input-Output Table for Environmental Impact Assessment .

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What I will talk?

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  1. A Simple Parallel Projection Optimization Algorithm Estimating a Large-size Input-Output Table for Environmental Impact Assessment Ting Yu, Julien Ugon, Manfred LenzenIntegrated Sustainability Analysis, University of Sydney, Australia School of Information Technology & Mathematical Sciences, University of Ballarat, Australia

  2. What I will talk? • Environment Impact Assessment: • Economic Input-Output Life Cycle Assessment (EIO-LCA) • A parallel optimization algorithm estimating a large-size input-output table

  3. Environment Impact Assessment • Definition: • An assessment of the possible impact (positive or negative) that a proposed project may have on the environment (consisting of the natural, social and economic aspects).

  4. Purpose of EIA • EIA becomes a part of standard corporate reports, the same as traditional accounting reports • Encourage business and public to consider the environmental impact of their actions • Government is able to implement its regulation • Investors are able to assess the impact of their investment on the environment (consisting of the natural, social and economic aspects).

  5. “Corporate sustainability reports and sustainability ratings are increasingly used as key information for investment and lending decisions.” “There is a growing awareness that shareholders’ value is enhanced by increased corporate social and environmental responsibility.” World Business Council for Sustainable Development (2002)

  6. Dollar as intermediary • Tone for CO2, Litre for water usage, Square metre for land usage, number of people for unemployment • Universal and single measurement for all kinds of impacts • Monetary measure for corporate reporting

  7. Embodied emissions from materials Lower embodied emissions from materials On-site emissions On-site emissions Construction Pty Water supplier Pty C D Case 1: Investors & insurersneed to see hidden risks, eg. GHG emissions

  8. Real-world complexities (1) Trucost & Defra (May 2006)

  9. Real-world complexities (2)

  10. The problem of quantification • “… there is still a lack of quantification in most reporting. … the majority of reports lack depth, rigour or quantification.” • “Most business will have supply chain impacts that they should understand and consider reporting. There is no single, quantifiable measure that companies can use as a Key Performance Indicator for the effect of their upstream supply chain on the environment.” Trucost & Defra (May 2006)

  11. Economic Input-Output Life Cycle Assessment (EIO-LCA) • The EIA enables decision makers to evaluate a project by data and analysis rather than a feeling that the natural product is better • A life cycle assessment (LCA) is the investigation and valuation of the environmental impacts of a given product or service caused or necessitated by its existence, and an evaluation of the environmental impacts of a product or process over its entire life cycle. • often thought of as "cradle to grave" and therefore as the most complete accounting of the environmental costs and benefits of a product or service • Economic Input-Output Life Cycle Assessment (EIO-LCA) method uses information about industry transactions - purchases of materials by one industry from other industries, and the information about direct environmental emissions of industries, to estimate the total emissions throughout the supply chain (Hendrickson, Lave, & Matthews, 2006 )

  12. Industrial interdependence in a modern economy: a “tree” of upstream production layers Lenzen & Murray, 2003

  13. ••• ••• ••• ••• ••• Energy for iron ore mining ••• 4 3 ••• ••• ••• ••• ••• Iron ore for steel F F F F F F F F F F F F F F F F F F F F F F F F F F F F F F R R R R R R R R R R R R R R R R R R R R R R R R R R R R R R G G G G G G G G G G G G G G G G G G G G G G G G G G G G G G E E E E E E E E E E E E E E E E E E E E E E E E E E E E E E S S S S S S S S S S S S S S S S S S S S S S S S S S S S S S Steel for ship 2 Manufacture of ship 1 Food Resources Goods Energy Services Shipping to smelter 0 Aluminium for use Production layers and structural paths: Example: Australian aluminium Lenzen & Murray, 2003

  14. 10 top upstream paths: energy use • Electricity> Al> exports 46.57 PJ (46.29%) • Alumina> Al> exports 14.48 PJ (14.39%) • Al> exports 8.24 PJ (8.19%) • Electricity> Alumina> Al> exports 1.40 PJ (1.39%) • Electricity> Al> stocks 0.78 PJ (0.78%) • Petroleum and coal products> Al> exports 0.40 PJ (0.40%) • Electricity> Bauxite> Alumina> Al> exports 0.34 PJ (0.34%) • Bauxite> Alumina> Al> exports 0.29 PJ (0.29%) • Iron and steel> Al> exports 0.26 PJ (0.26%) • Alumina> Al> stocks 0.24 PJ (0.24%)

  15. Banking

  16. Electricity Supply

  17. Why we need input-output table? e.g. total emissions (direct plus indirect) The structure of the economy Input-output table e.g. purchases of a company e.g. direct (on-site) emissions

  18. Physical & social data Integration National Input-Output Tables

  19. Input-output Table

  20. Input to mining Input to services Output from mining Output from Services

  21. Input Coefficients 4.5c of agriculture is needed for every dollar’s worth of manufacturing

  22. How much ghg does it take to provide $1000 worth of services (from this one supply chain) $1000 was the driver for this whole chain of reactions and its environmental consequences

  23. You spend $1000 on a weekend away. You have muffins for breakfast. They are manufactured. The manufacturer needs blueberries. They are farmed. The farm needs electricity. The power plant needs coal. The coal mine needs gas. The gas provider emits ghg. $1000 For mining For utilities For agricutlure For manufa-cturing For services ghg from utilities

  24. A Simple Example of a Matrix Used in Economic Study

  25. Where to get the input-output table? Google it? Or Estimate it?

  26. Answers • Survey, published by Australian Bureau of Statistics every 4 years • Or estimate the Input-output table • Purpose: populate the matrix by using available information, (matrix completion? With full rank?) • Significance: matrices are widely used in economic study and transportation planning to represent the commodity or traffic flows between origin and destination. • Difficulties: available information often is not completed, with a large amount of noise

  27. Available Data • Data From Australian Bureau of Statistics: • Australian National Accounts: State Accounts • Environment and Energy • Economy, Industry, Value of Agricultural Commodities Produced • Data from Australian business register • Data from Reserve Bank of Australia • Data from Sydney Water, and other private companies

  28. 2003-2004 2002-2003

  29. Temporal-Spatial Estimation with Conflicting Information (1) • Time series of Input-output tables • Spatial information from national or regional government, private cooperate, and research institutes, for example: • Total commodity trade of given industries between regions • Total green house gas emission of the given industry of a region within the current year • Conflicting information: • Caused by the data noise: error from the process of data collection • Change of underlying structure: non-stationary • Without considering the confliction, the problem becomes unsolvable.

  30. Temporal-Spatial Estimation with Conflicting Information (2) • IO table is estimated as a vector X • Main algorithm: subject to where X is the target vector to be estimated, X0 is the vector of the previous year which is known, E is a vector of the error components (uncertainty) dis is a distance metric which quantifies the difference between two vectors. G is the coefficient matrix for the local constraints C is the right-hand side value for the local constraints.

  31. Temporal-Spatial Estimation with Conflicting Information (3) • The reason why the vector E is introduced is to solve the conflicting information. • the vector E is introduced to balance the influence between the conflicting information, and reaches a tradeoff between the conflicting information. • Assumption: • the temporal stability, which assumes the industry structure of a certain region keeps constant or has very few changes within the given time period. This assumption is often required to be verified for long time period. Within the short time periods, dramatic change of the industry structure is relatively rare. • The datasets often contain the temporal patterns between years, such as the trend of the total output of certain industry sections, and also much spatial information regarding the total emission within a certain region such as national total emission and state total emission. • On the other hand, it is very common that either of datasets is not comprehensive and imperfect and even the conflicts between the datasets exist. Thereby, the estimation algorithm is required to consolidate the conflicted datasets to uncover underlying models.

  32. Parallel Projection Method (1) • Why parallel computing is needed? • A large amount of variables are estimated: a 2000-by-2000 matrix has 4,000,000 variables to be estimated • A large amount of available information is available to be utilized and need to be processed efficiently. • Available supercomputing facility

  33. Supercomputer at NCI

  34. Parallel Projection Method (2) • Original formula has to be rewritten: subject to: where • Linear constraints and quadratic objective function => Convex function • Partition the formula into many sub-problems:

  35. Parallel Projection Method (3) • Iterative process and convergence: where L is the relaxation parameter, and projection • Covex combination , where is the solution of i-th subproblem

  36. Test of Convergence The constraints converges to zero. the objective function converge to a constant level after the same number of iterations as the constraints are satisfied.

  37. Performance • A medium size optimization problem consists of 25,070 variables, 219 constraints. The optimization runs 5,000 iterations over 16 CPUs (or nodes). The whole process takes 01:15 minutes and uses 918MB memory totally. • A large size optimization problem consists of 3,340,800 variables, over 3,100 constraints. The optimization runs over 2,000 iterations over 16 CPUs (or nodes). The whole process takes 37:29 minutes and uses 2,280MB memory totally. • Available memory is update to 3GB*8*64 = 1,536 GB at the supercomputing facility.

  38. Experiments (1) • Direct evaluation of a large-size matrix is a rather difficult task. • A thousand-by-thousand matrix contains up to ten million numbers. Simple measurements such as the sum do not make too much sense, as the important deviation is submerged by the total deviation which normally is far larger than the individual ones. • Indirect evaluation: • Estimate the impact of the change of matrix elements on the final output in the whole economic system • It is more suitable when researchers are more interested to find out how sensitive the system is regarding the error of the estimation.

  39. Direct evaluation

  40. Experiments (2) • Indirect evaluation: sensitivity analysis by calculating the multipliers • How to calculate the multipliers: where M is the multiplier, I is the identity matrix, D is the change in the final output, and A is the technique coefficients matrix, each entry of which is the ratio: X is a value from the matrix estimated by the previous mining algorithm

  41. Change of Underlying Structure • Basically two series basically follow the same pattern. • The estimated multipliers are more volatile than the true underlying multipliers. This phenomenon indicates the estimated multipliers amplify the errors.

  42. Conclusion • Running over a supercomputing facility and reducing the computational time to 1.5 hours for estimating a 3000-by-3000 Input-output table. More importantly, the size of input-output table can be increased to 15,000-by-15,000, which is enough for the table representing global economic structure (150 countries). • A large-size Input-output table enables to analysis the environmental impact from a global perspective. The ISA will publish the first version of global Input-output table very soon. • Future development: • Speed up the algorithm • Vertically split the estimation algorithm

  43. Sustainable Development is not a cover up!

  44. European Union Emissions Trading System 2008-2013 & 2013 -2020 • Second phase 2008-2013 • 5% cut in 2005 levels • polluters still avoid cuts by investing in CDMs • free permits mean huge windfall profits. • Third phase 2013 to 2020 • permits to emit decided on EU-wide basis, rather than through national allocations Power producers to buy permits at auctionwww.guardian.co.uk/environment/2008/jan/04/em

  45. What ML and DM can do?

  46. ISA @ The University of Sydney http://www.isa.org.usyd.edu.au www.bottomline3.com

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