Fossil gas decarbonization with low-carbon fuels: A system dynamics modelling approach

The current study aims to develop a dynamic model for determining the future viability of RNG and hydrogen subjected to varying policy efforts, technology progress, and demand. System dynamics modelling was employed to evaluate the future viability of RNG and hydrogen through changes in fuel supply availability, fuel price, return on investment, and emission reduction simulations under different government subsidy scenarios, including investment support, tax reliefs, subsidy intensity, and duration. The model results indicated the ability to achieve over 10 % return on investments. Further, with increased supply capacity, the simulation indicated the potential to displace FNG 100 % by 2045 with surplus RNG and hydrogen. Moreover, RNG and hydrogen selling prices can be reduced to 0.009 $/ MJ and 4.8 $/kg H2 by 2050. The results demonstrate that subsidy policies and tax incentives facilitate the development and market diffusion of RNG and hydrogen. The findings highlight the potential of policy-driven market mechanisms to accelerate gas network decarbonization beyond North America. The study also emphasizes the socio-economic benefits, such as improved energy security, reduced emissions, and greater community resilience. The developed model serves as a useful tool for policymakers and investors to identify effective long-term strategies for decarbonization.