Conceptual Applications of the Risk Management Measures in Dynamic Models for the Farms Producing Biogas from Agriculture Biomass

As technologies of renewable energy production evolve, its sustainability aspects have become topical at the moment. Dynamic modeling allows designing the whole production system as well as testing the technological and economic aspects of this system for its efficiency and sustainability in a defined period of time. The dynamic model described in the article was set up for a farm that produces biogas from agriculture biomass. The dynamic model includes a full cycle of agricultural production and consists of several mutually connected blocks: production (grain, biomass, milk, meat, biogas, heat, electricity), finances (investments, income, outcome, subsidies, loans), resources (arable land, farms, bioreactor, technical equipment, workforce), and risks. The model was created within the Powersim Studio 7 software and was tested using the data obtained at the Latvia University of Agriculture (LLU) Study and Research farm,Vecauce” biogas production plant. Risks in the model are divided into 5 groups: personnel, production, environment, property and legislative (changes in the energy purchase tariffs) risks. They are assumed as probable variables with a normal distribution that is determined by an average value and a standard deviation. They are connected to the processes that they affect to calculate the impact of risks to the farm actions.