Policy Impact on Regional Biogas Using a Modular Modeling Tool

Abstract

Biogas development is expected to contribute to the National Recovery and Resilience plan to overcome the COVID-19 shock. Estimation of the agricultural biogas potential in economic terms can contribute to refining policies inciting effective sector development. In this paper, we attempt to do so by modeling a biogas chain from dedicated crops and livestock waste. This was achieved by coupling farming models to the biogas industry in a partial equilibrium framework. This allows for a comprehensive investigation of alternative measures in technology, size, spatial distribution and land use change. The integrated model was implemented in Lubelskie for the previous policy (green certificates) and the current policy (auction market). In both cases, the bottom-up profit driven optimization resulted in approximately 40 MWel, which shows a robust economic potential more than four times the biogas sector’s actual capacity in the region, also providing the detailed structure of the sector. When focusing on the industry structure, both scenarios give similar results regarding 1–2 MWel plant size close to the observed situation. The model also suggests a large number of new facilities <250 kWel, twice as important under scenario 2, indicating that other conditions beyond economy profitability should be fulfilled for further sector development.