Projecting the Regional Economic Impacts of Energy Development

Measurement of the regional economic and demographic effects of advanced US coal production is facilitated by the use of a multiregional model, National-Regional Impact Evaluation System (NRIES), which is a medium-run (5-10 years) impact analysis tool composed of 51 state econometric models. The first scenario examines advanced coal development occurring in a single region, Montana. The model is first used to solve a baseline case for normal activity, and an alternate solution is then made reflecting the effects of the new coal development. In the second scenario, a multiregional/national level of coal development (the major coal-producing states) is simulated. In both applications, a substantial expansion of economic activity was generated due to additional coal development. The specific manifestations of growth depended on the type of industry in which the initial growth occurred. The effect of a change in energy policy is obviously multifaceted.