Implementation of renewable energy sources while ensuring security of energy supply is a pressing issue in energy policy planning. Findings in literature suggest that biomethane and power-to-gas applications together with natural gas systems can have great benefits in terms of carbon emission reduction, contribution to local economies and circular economy and important impact to the phasing of fossil fuel-based energy systems. Moreover, according to theoretical background the diversification of supplies in natural gas system will enhance the infrastructural system resilience and contribute to the security of energy supplies. In this light the study presents a system dynamic model for biomethane and power-to-gas application in natural gas system in Latvia with the existing underground storage facility. The natural gas infrastructure technical characteristics, natural gas flow and storage regime dependence on the seasonal gas demand are considered in the model. The model presented in this study can help policy planners to determine the necessary steps for implementation of RES support policy in Latvia to reach goals of EU low carbon economy. This system dynamic model has a potential to be used for energy policy planning together with other system dynamic models developed within the context of Latvia to cover a range of issues in energy sector.