Abstract
In this paper, we present a dynamic simulation tool for biomethane policy design in Latvia. A new System Dynamics based computer simulation model covering the whole biogas-to-biomethane value chain including bioresource availability, biogas production and biogas utilization pathways is proposed. The goal of the model is to evaluate the efficiency of a set of policy instruments on increasing the transition from biogas for electricity production to biogas upgrading to be used as a transportation fuel thus contributing to national renewable energy targets in the transport sector by 2030. According to the modeling results, policy design should be focused on two directions, reducing the existing support mechanisms for electricity producers and subsidizing biomethane production, namely. Additional benefits are brought by tax policies aiming to increase the price of competing fossil fuels.
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