Open Access

ARTICLE

Behaviours of Multi-Stakeholders under China’s Renewable Portfolio Standards: A Game Theory-Based Analysis

Bing Wang^1,2, Kailei Deng¹, Liting He¹, Zhenming Sun^1,*

1 School of Energy and Mining Engineering, China University of Mining and Technology, Beijing, 100083, China
2 Beijing Key Laboratory for Precise Mining of Intergrown Energy and Resources, China University of Mining, Beijing, 100083, China

* Corresponding Author: Zhenming Sun. Email:

(This article belongs to this Special Issue: Energy Systems Management and Climate Change)

Energy Engineering 2021, 118(5), 1333-1351. https://doi.org/10.32604/EE.2021.014258

Received 14 September 2020; Accepted 11 January 2021; Issue published 16 July 2021

Abstract

China has implemented both quantitative and policy incentives for renewable energy development since 2019 and is currently in the policy transition stage. The implementation of renewable portfolio standards (RPSs) is difficult due to the interests of multiple stakeholders, including power generation enterprises, power grid companies, power users, local governments, and the central government. Based on China’s RPS policy and power system reform documents, this research sorted out the core game decision problems of China’s renewable energy industry and established a conceptual game decision model of the renewable energy industry from the perspective of local governments, power generation enterprises and power grid companies. The results reveal that for local governments, the probability of meeting the earnings quota or punishments for not reaching quota completion are the major determinants for active participation in quota supervision. For power grid firms, the willingness to accept renewable electricity quotas depends on the additional cost of receiving renewable electricity and governmental incentives. It is reasonable, from the theoretical perspective, to implement the RPS policy on the power generation side. Electricity reform will help clarify the electricity price system and increase the transparency of the quota implementation process. Policy implications are suggested to achieve sustainable development of the renewable energy industry from price incentives and quantity delivery.

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