Improving Prediction of Energy Futures: Most Energy-Economic Models Do Not Provide Policymakers with the Information They Need to Make Sound Decisions (Perspectives‪)‬

When federal lawmakers pass--or do not pass--legislation related to the production and use of energy, their actions ripple across society. Their decisions affect not only the mix of fuels, the price of power, and the spread of pollution, but also federal deficits, corporate fortunes, and even national security. Thus, policymakers need to have in hand the best possible projections about the future demand, supply, and cost of various energy options. Unfortunately, a growing disconnect exists between politicians and the economists who develop those projections. Various government agencies, as well as an array of universities, private consulting firms, and interest groups, have developed energy-economic models, some more sophisticated than others. Yet lawmakers increasingly feel that these models fail to answer, or even properly evaluate, their questions about the most effective means to achieve policy goals. Economists, meanwhile, complain that politicians do not ask clear questions of the models.