Understanding the complexity of energy systems with a simulation game

This post is by Dr. Émile Chappin, Assistant Professor of Energy & Industry, Delft University of Technology, and a Visiting Researcher at Fields of View. Dr. Chappin worked with us on developing a simulation game to understand to complexity of energy systems. These are his thoughts about the complexity of the sector and how a simulation game helps in understanding it.

 

Vibrant Electronics City sets the scene for three weeks of intensive research on serious gaming. We are driven by the need for stability and affordability of our energy supply – they are essential for flourishing societies. That’s the reason to deal with the nitty-gritty of typical European electricity markets in which billions of Rupees or Euros are at stake but where megawatts and megawatthours are easily mixed up. The key is not only in the details: electricity markets are complex systems, of which the performance is the result of the transactions in the market, the responses to the influences from outside, such as (proposed) policies, the evolving institutions and rational or irrational expectations.

 

This is where we start: how can we really learn to understand the essential workings of this system? The pure nature of complexity tells us that we can’t, really. But that’s not a satisfactory answer. We should do something that helps us – students, researchers, policy makers and companies – to gain better understanding of these systems. We need to start learning how we can somehow manage the system as a whole throughout the coming decades. Not in the classical sense of management, which presumes that some form of direct control is possible. We need to find new ways of shaping the system in a (more) desired direction. How? Join us in the world of simulation games!

We would like to share four insights we learnt from complexity and developing and using simulation games and models:

  1. The notion of optimality is void. There is no perfect outcome of this system/problem. Such judgments of the system state are observer-dependent, time-dependent and cannot be predicted. One can only speak of trajectories that appear desirable or not, given a set of strong assumptions, a time-frame, a set of objectives and a delineated system.

  2. Simulation and gaming should be used as tools for discussion. Because the system we’re observing is complex, any model we make and any simulation we run is definitively wrong. That, however, does not make them useless: they can be used as a digital laboratory, our laboratory in silico. By applying many modeling and simulation techniques capturing parts of the real-world system and its problems, and using those in a variety of relevant contexts, we may get a glimpse of understanding what patterns may emerge and how we can contribute in shaping the system [1]. That is the approach for TU Delft’s Energy Modeling Laboratory [2].

  3. Experience and involvement leads to deeper understanding. The complexity in the real-world system works in counterintuitive mechanisms and leads to patterns that are hard to really understand. Our experience shows that grasping some of these patterns by experiencing them in a serious game really helps to build an intuition for the consequences of the system’s complexity [1]. That in itself implies that lessons learnt – or patterns observed – may well contribute to understanding the complexity of the real world system and any effort in shaping the system accordingly. An example in our game is the understanding that ‘simple’ economic laws such as the notion of marginal cost bidding really work (at least to a certain extent). Other examples are the irrational response to soft information of future developments, the almost unbelievable developments on world markets for fuels, the wicked trade-offs between short-term profit, market share and the reliability and affordability of energy supply in the long run.

  4. Managing is the art to use the mechanisms that drive change. Understanding and exploring what the mechanisms are that drive our societal system is extremely difficult, if not impossible. Let’s consider this management that, making use of that, an art, an “attempt to bring order out of chaos” [3]. How to know what decisions matter, what actors matter and what outcomes matter? How to measure performance? How to measure change? To answer such questions, we need to bring together theory from various fields (history, engineering, multi-actor systems, complexity, economics, policy, design, etc.) and knowledge from application domains (energy, water, transport, IT).
    We hope that simulation and gaming contributes to this process. By doing so, we make the theory operational in specific domains: we ask questions such as how we can develop and maintain an affordable electricity sector which is both decarbonized and in which supply is secured. It helps us to define what change and stability really means and how we can measure it. That way we hope to find out how we may bring about changes that put our systems on a more desired trajectory. If we can manage our precious infrastructures – the backbones of our society – that may be how.

How can a three week trip to Bangalore help gaining insight in the Dutch electricity sector? Which countries – including their energy sectors – are more different than the Netherlands and India? Well… despite the fact that the Indian and the Dutch culture are fundamentally different, both societies show many communalities. Both India and the Netherlands are quite busy: at least traffic is a pain. The fraction of the Indian population that resides in Holland may not be so far apart from the fraction of Dutch people that are in India. What Indian food is, is impossible to define, as it is for Dutch food (although for different reasons). It is easy to complain about the weather – umbrellas are a requisite in your backpack. Dutch and Indians can express themselves in peculiar ways in English. Indians like chocolate and ‘stroopwafels’ as least as well as the Dutch. And… more often than not, we can meet each other in humor.

These commonalities show that the complexity of our societies does not mean we cannot try to understand and improve them. It means we need to find new ways of doing so. The mechanisms and laws probably do not work as we expect them to! There is only one way forward: dive in the deep, experience new things, debate with an open mind, challenge all assumptions, indulge in to cultural diversity, and… embrace complexity!

 

Literature

[1] Chappin, E. J. L. (2011). Simulating Energy Transitions, PhD thesis, TU Delft, the Netherlands. http://chappin.com/thesis

[2] Energy Modeling Laboratory, TU Delft. http://emlab.tudelft.nl

[3] Stephen Sondheim, composor and lyricist, 2005.

 

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