MINING SECTOR ELECTRICITY

Hi Tom, Great questions. I apologize for not catching this sooner as typically questions of this nature would be posted to our Support Forum. However the economist has responded to your question, please see below. I will have to ask that if there are any additional follow up questions, to please post those to our support forum! If you are just trying to model the economic impact of the mine itself (including its electricity unit) and you know the split of mining activity vs. electricity production, you can simply set up two Events in the same Activity - one for the mining portion (sector 24) and one for the electricity generation portion (sector 31). However, since you would be modeling the electricity production as a separate Event, you would need to first make it so that sector 24 does not purchase commodity 3031, else you would be overstating the impact to sector 31. To do this, go to Customize > Industry Production and select sector 24 from the list on the left. Write down the Coefficient for commodity 3031, then overwrite it with 0. Next, scroll down to commodity 3436 (Noncomparable foreign imports) and add commodity 3031's previous coefficient (the one you just wrote down) to commodity 3436's current coefficient. This ensures that the Total Absorption Value (seen to the left of the production function list) remains the same (if you did not do this, then more would be spent on Value-Added since Output must equal Intermediate Expenditures + Value-Added). After making these two changes, you'll need to click "Save" and then go to Options > Construct > Multipliers. Then you'll be able to run the two Events as described at the outset. If you do not know the split between mining activity vs. electricity production (which would rule out the method suggested above), we would suggest changing sector 24's RPC for commodity 3013 to 1. This ensures that all of sector 24's purchases of electricity are local - this will give you virtually the same impact as the method above, though it will be using IMPLAN's suggestion as to how much electricity production is needed for a mine. While it is possible to change the production functions and byproducts in IMPLAN (via the Customize > Industry Production and Customize > Commodity Production menus, respectively), we do not recommend this because it means that all other industries and institutions that purchase electricity will also purchase some of their electricity from the mining sector, which is not likely the case. Thanks

You are correct that we need to be sure the electricity produce by the gold mine does not have a chance to be purchased by other sectors. The gold mine has constructed an electric power plant for its own use. Therefore would the inputs to produce electricity have to be incorporated into the gold mining sector production function?

Hi Tom, You won't have to worry about the inputs to electricity if you use the method of two Events described below, one for your mining Sector and one for the electricity producer. Just a note about a possibly simpler alternative to moving sector 24's coefficient for 3031 into commodity 3436 (as described in post 18267): instead of doing that, you could simply change Sector 24's RPC for commodity 3031 to 0 - this will have the equivalent effect of making sure the mining Sector does not buy any local electricity (since we are modeling that separately and don't want to double-count) while keeping the Total Absorption the same. Hopefully this helps, Please let us know if you have any additional questions. IMPLAN Support Team