Modelling the Latvian power market to evaluate its environmental long-term performance q Dagnija Blumberga ⇑ , Andra Blumberga, Aiga Barisa, Marika Rosa, Dace Lauka Riga Technical University, Institute of Energy Systems and Environment, Azenes Str. 12/1, Riga LV1043, Latvia highlights  Newly developed computer-aided simulation model.  Consumption of the fossil fuel – natural gas – will not exceed 10% in 2050.  GHG emissions in the energy sector will be insignificant and draw 0.04 tCO 2 /MW h e. article info Article history: Received 5 November 2014 Received in revised form 4 June 2015 Accepted 5 June 2015 Available online xxxx Keywords: Modelling Power Renewable energy System dynamics abstract In this paper we study development patterns of Latvian electricity market. It is done based on a newly developed computer-aided simulation model. System dynamics approach was used to simulate long-term development of electricity sector in the region under the existing policy design. Results demonstrate that renewable energy sources have a high potential to integrate in the electricity genera- tion balance. Important preconditions for this to happen are: presence of appropriate support measures, a continuous technological progress and fossil fuel price increase. Under such scenario around 70% carbon dioxide emission savings can be achieved by 2050. Ó 2015 Elsevier Ltd. All rights reserved. 1. Introduction Efforts to reduce greenhouse gas (GHG) emissions are at the top of the European Union (EU) political agenda. Increased use of energy from renewable sources constitute important part of the package of measures needed to reduce EU greenhouse gas emissions and comply with Community and international GHG emission reduction commitments. The Renewable Energy Directive 2009/28/EC established a European framework for the promotion of renewable energy, setting mandatory national renewable energy targets for achieving a 20% share of renewable energy in final energy consumption by 2020. Recently EU leaders have agreed on further framework for climate and energy policies. The new policy sets a target of at least 27% for renewable energy by 2030 and is a continuous step towards the ambitious long-term goal of cutting emissions 80–95% by 2050. As outlined in the European Commission’s Roadmap for moving to a competitive low carbon economy in 2050 GHG emissions would need to be reduced by 40% by 2030 and 60% by 2040 to be on track to reach 2050 target. As the biggest contributor of the EU’s total emissions of carbon dioxide, energy sector plays an important role in mitigating climate change. It is estimated that the power sector will play a role of increasing importance allowing to achieve a significant level of decarbonization (55–97% by 2050 depending on scenario) [1]. In response to environmental, social and economic pressures governments are facing a continuous challenge to develop transi- tion pathways to make their electricity systems more sustainable [2]. According to the statistical office of the European Union [3] electricity generation from renewable energy sources in the EU-28 has increased from 14.8% in 2005 to 25.4% in 2013. The increase of the renewable energy share in the EU can be explained by the combination of higher consumption of final energy from renewable energy sources and of a decrease of the total gross final energy consumption compared to 2010. During 2005–2013 highest increase in the share of renewable energy sources in power http://dx.doi.org/10.1016/j.apenergy.2015.06.016 0306-2619/Ó 2015 Elsevier Ltd. All rights reserved. q This article is based on a short proceedings paper in Energy Procedia Volume 161 (2014). It has been substantially modified and extended, and has been subject to the normal peer review and revision process of the journal. This paper is included in the Special Issue of ICAE2014 edited by Prof. J Yan, Prof. DJ Lee, Prof. SK Chou, and Prof. U Desideri. ⇑ Corresponding author. Tel./fax: +371 670 899 08. E-mail address: dagnija.blumberga@rtu.lv (D. Blumberga). Applied Energy xxx (2015) xxx–xxx Contents lists available at ScienceDirect Applied Energy journal homepage: www.elsevier.com/locate/apenergy Please cite this article in press as: Blumberga D et al. Modelling the Latvian power market to evaluate its environmental long-term performance. Appl Energy (2015), http://dx.doi.org/10.1016/j.apenergy.2015.06.016