The European Union has established a number of targets regarding energy efficiency, Renewable Energy Sources (RES) and CO2 reductions as the 'GREEN PAPER on Energy Efficiency', the Directive for 'promotion of the use of bio-fuels or other renewable fuels for transport' or 'Directive of the European Parliament of the Council cm the promotion of cogeneration based on a useful heat demand in the internal energy market'. Many of the according RES and RUE measures are not attractive for investors from an economic point of view. Therefore, governments all over the world have to spend public money to promote these technologies/ measures to bring them into market. These expenditures have to be adjusted to budget concerns and should be spent most efficiently. Therefore, the spent money has to be dedicated to technologies and efficiency measures with the best yield in CO2 reduction without wasting money. The core question: 'How can public money-for promoting sustainable energy systems-be spent most efficiently to reduce GHG emissions?' has well been investigated by the European project Invert. In course of this project, a simulation tool has been designed to answer this core question. This paper describes the modelling with the Invert simulation tool and shows the key features necessary for simulating the energy system. A definition of 'Promotion Scheme Efficiency' is given, which allows estimating the most cost-effective technologies and/or efficiency measures to reduce CO2 emissions. Investigations performed with the Invert simulation tool deliver an optimum portfolio mix of technologies and efficiency measures for each selected region. Within Invert, seven European regions were simulated and for the Austrian case study, the detailed portfolio mix is shown and political conclusions are derived. (c) 2006 Elsevier Ltd. All rights reserved.