AbstractIn Earth system modelling, a description of the energy budget of the vegetated surface layer is fundamental as it determines the meteorological conditions in the planetary boundary layer and as such contributes to the atmospheric conditions and its circulation. The energy budget in most Earth system models has been based on a big-leaf approach, with averaging schemes that represent in-canopy processes. Furthermore, to be stable, that is to say, over large time steps and without large iterations, a surface layer model should be capable of implicit coupling to the atmospheric model. Surface models with large time steps, however, have difficulties in reproducing consistently the energy balance in field observations. Here we outline a newly developed numerical model for energy budget simulation, as a component of the land surface model ORCHIDEE-CAN (Organising Carbon and Hydrology In Dynamic Ecosystems – CANopy). This new model implements techniques from single-site canopy models in a practical way. It includes representation of in-canopy transport, a multi-layer long-wave radiation budget, height-specific calculation of aerodynamic and stomatal conductance, and interaction with the bare-soil flux within the canopy space. Significantly, it avoids iterations over the height of the canopy and so maintains implicit coupling to the atmospheric model LMDz (Laboratoire de Météorologie Dynamique Zoomed model). As a first test, the model is evaluated against data from both an intensive measurement campaign and longer-term eddy-covariance measurements for the intensively studied Eucalyptus stand at Tumbarumba, Australia. The model performs well in replicating both diurnal and annual cycles of energy and water fluxes, as well as the vertical gradients of temperature and of sensible heat fluxes.