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Socio-economic scenarios

Socio-economic scenarios. Anand Patwardhan IIT-Bombay. Crude oil price forecasts. Why do we need scenarios?. The uncertainty explosion Prediction or planning Idea of “not implausible” futures Robustness vs. optimality Context for a forecast. Scenarios and V&A assessment.

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Socio-economic scenarios

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  1. Socio-economic scenarios Anand Patwardhan IIT-Bombay

  2. Crude oil price forecasts Anand Patwardhan, IIT-Bombay

  3. Why do we need scenarios? • The uncertainty explosion • Prediction or planning • Idea of “not implausible” futures • Robustness vs. optimality • Context for a forecast Anand Patwardhan, IIT-Bombay

  4. Scenarios and V&A assessment • Hazard – exposure – impacts – response • Scenarios for the individual layers and their interactions • Socio-economic and climate • Relevant to the scale of assessment Anand Patwardhan, IIT-Bombay

  5. Scenarios • Plausible, pertinent and logically consistent alternative stories of the future • Provide the context for a forecast • Strategic thinking, and the quality of that thinking rather than planning • Exploratory (positive) and normative Anand Patwardhan, IIT-Bombay

  6. Building scenarios • Central question / issue being considered • What are the things that really matter? • What are the key drivers (both micro and macro)? • What are plausible storylines for describing their evolution? • What are the interconnections and dependencies? • Can we quantify some of the drivers and their measures? Anand Patwardhan, IIT-Bombay

  7. Drivers • Socio-economic context • Demographics • Economic growth • Consumer values and preferences • Technology • What is pre-determined and what is uncertain? • What is constrained? Anand Patwardhan, IIT-Bombay

  8. Links between the drivers Energy consumption & per capita GDP Anand Patwardhan, IIT-Bombay

  9. More linkages between drivers Anand Patwardhan, IIT-Bombay

  10. Storylines • Interconnections and dependencies • Describing future evolution • What is consistency? • In what way might dependencies change? • Dematerialization • Income and energy Anand Patwardhan, IIT-Bombay

  11. Decoupling drivers (income and energy) Anand Patwardhan, IIT-Bombay

  12. Discontinuities and branching points How might they happen? Are there early indicators? Where might they happen? Anand Patwardhan, IIT-Bombay

  13. Where might they happen? • The climate system – collapse of the North Atlantic thermohaline circulation • The socio-economic system – early development of a hydrogen-based backstop energy system • What about from the coupled system? Is it less or more susceptible to discontinuity? Anand Patwardhan, IIT-Bombay

  14. Past discontinuities in energy technology – non-marginal change in energy systems Anand Patwardhan, IIT-Bombay

  15. Linking climate and socio-economic scenarios • Socio-economic scenarios lead to emissions lead to climate change • What about the reverse? • For example, if we do carbon management on a large-scale, what does that mean for the dynamics of the carbon cycle? • Feedback – what parts of the system can be treated as exogenous? Anand Patwardhan, IIT-Bombay

  16. General to the specific • Global to local / regional • Down-scale the global • Or • Use the global for checking consistency Anand Patwardhan, IIT-Bombay

  17. Example: regional assessment (urban) • Drivers: • Regional demographics, migration • Economic growth • Settlement characteristics • Storylines: • Perhaps start from the SRES storylines • Development with settlement form and pattern • Public infrastructure • Perhaps climate is exogenous Anand Patwardhan, IIT-Bombay

  18. Judging scenarios • Recognizable and grounded in the present • Empirical constraints • Plausible • Internal consistency • Fit within models • Challenge existing mental map • Consequences for decisions Anand Patwardhan, IIT-Bombay

  19. From scenarios to forecasts • Build forecasts in the context of scenarios • Extrapolative • Statistical • Model-based (example: diffusion models) • Pattern-based • By analogy • Precursors • Normative, goal-based • Expert judgment (Delphi) Anand Patwardhan, IIT-Bombay

  20. Forecasting issues • Attributes: explicit, reproducible, quantitative (?) • Value, skill, quality, reliability • What do we want to forecast? Anand Patwardhan, IIT-Bombay

  21. Issues • Tyranny of the present • Discontinuities and surprise • Process improvement rather than prediction • Scenarios as learning tools • Process understanding rather than specific outcomes • From static to dynamic Anand Patwardhan, IIT-Bombay

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