Energy policy for energy intensive manufacturing companies and its impact on energy efficiency improvements. System dynamics approach

Abstract

In this paper we evaluate Latvian Energy policy for energy intensive manufacturing companies and its impact on energy efficiency improvements using system dynamic approach. Since mid-2015, energy policy developments in Latvia are targeted to reduce energy costs for energy-intensive companies while imposing an obligation to implement an energy management system, which would increase the overall efficiency of the manufacturing industries. Simulation of theoretical energy-intensive manufacturing company behaviour showed interest in energy efficiency measures until its energy intensity closes to the benchmark stated in the energy policy, and then following corrective actions are taken to maintain the energy intensity above the benchmark. This results in lost energy efficiency savings. To minimize energy efficiency effect on the energy intensity calculation, the amendments to the energy policy is offered and its impacts are simulated using system dynamic modelling.