IDEAS home Printed from https://ideas.repec.org/a/eee/energy/v263y2023ipas0360544222025026.html
   My bibliography  Save this article

Bidding modes for renewable energy considering electricity-carbon integrated market mechanism based on multi-agent hybrid game

Author

Listed:
  • Zhang, Xinyue
  • Guo, Xiaopeng
  • Zhang, Xingping

Abstract

The proposal of carbon peak and carbon neutrality goals will inevitably promote the large-scale development of renewable energy, and the market mechanism is also being pushed forward to absorb more renewable energy in China. Considering electricity-carbon integrated market mechanism, this paper constructs a hybrid game model to study the evolutionary process of renewable energy generation companies (GENCOs) in market trading by setting up three renewable energy bidding modes. Among them, the leader-follow relationship between GENCOs and the day-ahead electricity market is reflected by the Stackelberg game model, and the bidding behavior of different GENCOs is described by cooperative and non-cooperative game models. The role of different stages for the carbon emissions trading (CET) market on the electricity market is discussed based on the sensitivity analysis. The simulation results show that the bundled sales between wind, photovoltaic and thermal power GENCOs could improve the expected profits of each GENCO and reduce the total carbon emissions. As the proportion of renewable energy in the electricity market increases, the clearing prices will decrease. Meanwhile, the peak-shaving times of thermal power units will raise, and thermal power GENCOs are more willing to participate in the auxiliary service market. Besides, the complete marketization of renewable energy GENCOs will affect the recovery of the initial investment. Moreover, it can be found that lower free carbon quota, higher CET and Chinese certified emission reduction (CCER) prices can effectively guide the electricity market to be cleaner.

Suggested Citation

  • Zhang, Xinyue & Guo, Xiaopeng & Zhang, Xingping, 2023. "Bidding modes for renewable energy considering electricity-carbon integrated market mechanism based on multi-agent hybrid game," Energy, Elsevier, vol. 263(PA).
    • Handle: RePEc:eee:energy:v:263:y:2023:i:pa:s0360544222025026
    DOI: 10.1016/j.energy.2022.125616
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0360544222025026
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.energy.2022.125616?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Yang, Lin & Xu, Mao & Fan, Jingli & Liang, Xi & Zhang, Xian & Lv, Haodong & Wang, Dong, 2021. "Financing coal-fired power plant to demonstrate CCS (carbon capture and storage) through an innovative policy incentive in China," Energy Policy, Elsevier, vol. 158(C).
    2. Fan, Jing-Li & Xu, Mao & Yang, Lin & Zhang, Xian, 2019. "Benefit evaluation of investment in CCS retrofitting of coal-fired power plants and PV power plants in China based on real options," Renewable and Sustainable Energy Reviews, Elsevier, vol. 115(C).
    3. Tiwari, Aviral Kumar & Aikins Abakah, Emmanuel Joel & Gabauer, David & Dwumfour, Richard Adjei, 2022. "Dynamic spillover effects among green bond, renewable energy stocks and carbon markets during COVID-19 pandemic: Implications for hedging and investments strategies," Global Finance Journal, Elsevier, vol. 51(C).
    4. Zhang, Xinhua & Gan, Dongmei & Wang, Yali & Liu, Yu & Ge, Jiali & Xie, Rui, 2020. "The impact of price and revenue floors on carbon emission reduction investment by coal-fired power plants," Technological Forecasting and Social Change, Elsevier, vol. 154(C).
    5. Chen, Zhongfei & Zhang, Xiao & Chen, Fanglin, 2021. "Do carbon emission trading schemes stimulate green innovation in enterprises? Evidence from China," Technological Forecasting and Social Change, Elsevier, vol. 168(C).
    6. Fan, Jing-Li & Wei, Shijie & Yang, Lin & Wang, Hang & Zhong, Ping & Zhang, Xian, 2019. "Comparison of the LCOE between coal-fired power plants with CCS and main low-carbon generation technologies: Evidence from China," Energy, Elsevier, vol. 176(C), pages 143-155.
    7. Liu, Tingting & Xu, Jiuping, 2021. "Equilibrium strategy based policy shifts towards the integration of wind power in spot electricity markets: A perspective from China," Energy Policy, Elsevier, vol. 157(C).
    8. Yue Liu & Lixin Tian & Zhuyun Xie & Zaili Zhen & Huaping Sun, 2021. "Option to survive or surrender: carbon asset management and optimization in thermal power enterprises from China," Papers 2104.04729, arXiv.org.
    9. Jafari, Mehdi & Korpås, Magnus & Botterud, Audun, 2020. "Power system decarbonization: Impacts of energy storage duration and interannual renewables variability," Renewable Energy, Elsevier, vol. 156(C), pages 1171-1185.
    10. Tan, Qinliang & Ding, Yihong & Zheng, Jin & Dai, Mei & Zhang, Yimei, 2021. "The effects of carbon emissions trading and renewable portfolio standards on the integrated wind–photovoltaic–thermal power-dispatching system: Real case studies in China," Energy, Elsevier, vol. 222(C).
    11. Shuai, Jing & Zhao, Yujia & Wang, Yilan & Cheng, Jinhua, 2022. "Renewable energy product competitiveness: Evidence from the United States, China and India," Energy, Elsevier, vol. 249(C).
    12. Das, Saborni & Basu, Mousumi, 2020. "Day-ahead optimal bidding strategy of microgrid with demand response program considering uncertainties and outages of renewable energy resources," Energy, Elsevier, vol. 190(C).
    13. Ferruzzi, Gabriella & Cervone, Guido & Delle Monache, Luca & Graditi, Giorgio & Jacobone, Francesca, 2016. "Optimal bidding in a Day-Ahead energy market for Micro Grid under uncertainty in renewable energy production," Energy, Elsevier, vol. 106(C), pages 194-202.
    14. Wang, Yubin & Dong, Wei & Yang, Qiang, 2022. "Multi-stage optimal energy management of multi-energy microgrid in deregulated electricity markets," Applied Energy, Elsevier, vol. 310(C).
    15. Coelho, António & Iria, José & Soares, Filipe, 2021. "Network-secure bidding optimization of aggregators of multi-energy systems in electricity, gas, and carbon markets," Applied Energy, Elsevier, vol. 301(C).
    16. Shafiekhani, Morteza & Ahmadi, Abdollah & Homaee, Omid & Shafie-khah, Miadreza & Catalão, João P.S., 2022. "Optimal bidding strategy of a renewable-based virtual power plant including wind and solar units and dispatchable loads," Energy, Elsevier, vol. 239(PD).
    17. Mo, Jianlei & Cui, Lianbiao & Duan, Hongbo, 2021. "Quantifying the implied risk for newly-built coal plant to become stranded asset by carbon pricing," Energy Economics, Elsevier, vol. 99(C).
    18. Hua, Weiqi & Jiang, Jing & Sun, Hongjian & Wu, Jianzhong, 2020. "A blockchain based peer-to-peer trading framework integrating energy and carbon markets," Applied Energy, Elsevier, vol. 279(C).
    19. Yang, Bo & Wei, Yi-Ming & Liu, Lan-Cui & Hou, Yun-Bing & Zhang, Kun & Yang, Lai & Feng, Ye, 2021. "Life cycle cost assessment of biomass co-firing power plants with CO2 capture and storage considering multiple incentives," Energy Economics, Elsevier, vol. 96(C).
    20. Kalyanmoy Deb & Kalyanmoy Deb, 2014. "Multi-objective Optimization," Springer Books, in: Edmund K. Burke & Graham Kendall (ed.), Search Methodologies, edition 2, chapter 0, pages 403-449, Springer.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Kandpal, Bakul & Backe, Stian & Crespo del Granado, Pedro, 2024. "Enhancing bargaining power for energy communities in renewable power purchase agreements using Gaussian learning and fixed price bargaining," Energy, Elsevier, vol. 309(C).
    2. Wang, Peng & Guo, Zixuan & Zhang, Shengyu & Zhu, Lin & Yi, Liqi & Song, Xiaohua, 2024. "Strategic behaviors of renewable energy generation companies participating in the electricity and carbon coupled markets based on non-cooperative game theory," Energy, Elsevier, vol. 312(C).
    3. Wanli Fang & Yijie Bian, 2024. "Do Affordable, Clean, and Modern Energy Matter for Environmental Sustainability? The Dynamic Effects of Different Strategies of Renewable Energy, Carbon Emissions, and Trade Openness on Sustainable Ec," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(2), pages 9440-9451, June.
    4. Wang, Benke & Li, Chunhua & Ban, Yongshuang & Zhao, Zeming & Wang, Zengxu, 2024. "A two-tier bidding model considering a multi-stage offer‑carbon joint incentive clearing mechanism for coupled electricity and carbon markets," Applied Energy, Elsevier, vol. 368(C).
    5. Dimitriadis, Christos N. & Tsimopoulos, Evangelos G. & Georgiadis, Michael C., 2023. "Optimal bidding strategy of a gas-fired power plant in interdependent low-carbon electricity and natural gas markets," Energy, Elsevier, vol. 277(C).
    6. Ye, Yingjin & Lin, Boqiang & Que, DingFei & Cai, Sijie & Wang, Chonghao, 2024. "COVID-19, the Russian-Ukrainian conflict and the extreme spillovers between fossil energy, electricity, and carbon markets," Energy, Elsevier, vol. 311(C).
    7. Tan, Qinliang & Han, Jian & Liu, Yuan, 2023. "Examining the synergistic diffusion process of carbon capture and renewable energy generation technologies under market environment: A multi-agent simulation analysis," Energy, Elsevier, vol. 282(C).
    8. Xiaohua Song & Yamin Huang & Yulin Zhang & Wen Zhang & Zeqi Ge, 2023. "An Appraisal on China’s Feed-In Tariff Policies for PV and Wind Power: Implementation Effects and Optimization," Sustainability, MDPI, vol. 15(6), pages 1-23, March.
    9. Yuan, Rongsheng & Liu, Ming & Chen, Weixiong & Yan, Junjie, 2024. "Costs versus revenues of flexibility enhancement techniques for thermal power units in electricity-carbon joint markets," Energy, Elsevier, vol. 302(C).
    10. Wu, Shengyang & Ding, Zhaohao & Wang, Jingyu & Shi, Dongyuan, 2023. "Unveiling bidding uncertainties in electricity markets: A Bayesian deep learning framework based on accurate variational inference," Energy, Elsevier, vol. 276(C).
    11. Nadeem, Muhammad & Wang, Zilong & Shakeel, Muhammad, 2023. "Real output, fossil fuels, clean fuels and trade dynamics: New insights from structural break models in China," Applied Energy, Elsevier, vol. 350(C).
    12. Gan, Lu & Xiong, Qian & Chen, Xiuyun & Lin, Zhiyi & Jiang, Wen, 2025. "Optimal dispatch schedule for the coordinated hydro-wind-photovoltaic system with non-priority output utilizing combined meta-heuristic," Omega, Elsevier, vol. 131(C).
    13. Feng, Sida & Zhang, Xingping & Zhang, Haonan & Ju, Liwei & Zhang, Xinyue, 2024. "A two-stage bi-level electricity-carbon coordinated optimization model for China's coal-fired power system considering variable renewable energy bidding," Energy, Elsevier, vol. 312(C).
    14. Zhou, Dequn & Zhang, Yining & Wang, Qunwei & Ding, Hao, 2024. "How do uncertain renewable energy induced risks evolve in a two-stage deregulated wholesale power market," Applied Energy, Elsevier, vol. 353(PB).
    15. Shi, Shouyuan & Yu, Tao & Lan, Chaofan & Pan, Zhenning, 2024. "Estimating the actual emission cost in an annual compliance cycle: Synergistic generation and carbon trading optimization for price-taking generation companies," Applied Energy, Elsevier, vol. 376(PA).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Zhang, Xinyue & Guo, Xiaopeng & Zhang, Xingping, 2023. "Assessing the policy synergy among power, carbon emissions trading and tradable green certificate market mechanisms on strategic GENCOs in China," Energy, Elsevier, vol. 278(PB).
    2. Fan, Jing-Li & Li, Zezheng & Li, Kai & Zhang, Xian, 2022. "Modelling plant-level abatement costs and effects of incentive policies for coal-fired power generation retrofitted with CCUS," Energy Policy, Elsevier, vol. 165(C).
    3. Fan, Jing-Li & Li, Zezheng & Ding, Zixia & Li, Kai & Zhang, Xian, 2023. "Investment decisions on carbon capture utilization and storage retrofit of Chinese coal-fired power plants based on real option and source-sink matching models," Energy Economics, Elsevier, vol. 126(C).
    4. Wang, Yubin & Zheng, Yanchong & Yang, Qiang, 2023. "Day-ahead bidding strategy of regional integrated energy systems considering multiple uncertainties in electricity markets," Applied Energy, Elsevier, vol. 348(C).
    5. Zhang, Xinyue & Guo, Xiaopeng & Zhang, Xingping, 2024. "Mutual conversion mechanisms for environmental interest products to jointly enhance synergistic effect between power, CET and TGC markets in China," Energy Economics, Elsevier, vol. 131(C).
    6. Li, Yanbin & Zhao, Ke & Zhang, Feng, 2023. "Identification of key influencing factors to Chinese coal power enterprises transition in the context of carbon neutrality: A modified fuzzy DEMATEL approach," Energy, Elsevier, vol. 263(PA).
    7. Wang, Dongxue & Fan, Ruguo & Yang, Peiwen & Du, Kang & Xu, Xiaoxia & Chen, Rongkai, 2024. "Research on floating real-time pricing strategy for microgrid operator in local energy market considering shared energy storage leasing," Applied Energy, Elsevier, vol. 368(C).
    8. Xiang, Yue & Wu, Gang & Shen, Xiaodong & Ma, Yuhang & Gou, Jing & Xu, Weiting & Liu, Junyong, 2021. "Low-carbon economic dispatch of electricity-gas systems," Energy, Elsevier, vol. 226(C).
    9. Rezaei, Navid & Pezhmani, Yasin & Khazali, Amirhossein, 2022. "Economic-environmental risk-averse optimal heat and power energy management of a grid-connected multi microgrid system considering demand response and bidding strategy," Energy, Elsevier, vol. 240(C).
    10. Gupta, Aparna & Palepu, Sai, 2024. "Designing risk-free service for renewable wind and solar resources," European Journal of Operational Research, Elsevier, vol. 315(2), pages 715-728.
    11. Xu Wang & Xiang Su & Ke Bi, 2023. "Achieving Synergies of Carbon Emission Reduction, Cost Savings, and Asset Investments in China’s Industrial Sector: Towards Sustainable Practices," Sustainability, MDPI, vol. 15(14), pages 1-21, July.
    12. Wang, Benke & Li, Chunhua & Ban, Yongshuang & Zhao, Zeming & Wang, Zengxu, 2024. "A two-tier bidding model considering a multi-stage offer‑carbon joint incentive clearing mechanism for coupled electricity and carbon markets," Applied Energy, Elsevier, vol. 368(C).
    13. Yao, Wenliang & Wang, Chengfu & Yang, Ming & Wang, Kang & Dong, Xiaoming & Zhang, Zhenwei, 2023. "A tri-layer decision-making framework for IES considering the interaction of integrated demand response and multi-energy market clearing," Applied Energy, Elsevier, vol. 342(C).
    14. Zhou, Wenlong & Fan, Wenrong & Lan, Rujia & Su, Wenlong & Fan, Jing-Li, 2025. "Retrofitted CCS technologies enhance economy, security, and equity in achieving carbon zero in power sector," Applied Energy, Elsevier, vol. 378(PA).
    15. Guo, Hongye & Chen, Qixin & Shahidehpour, Mohammad & Xia, Qing & Kang, Chongqing, 2022. "Bidding behaviors of GENCOs under bounded rationality with renewable energy," Energy, Elsevier, vol. 250(C).
    16. Xiao, Tianqi & You, Fengqi, 2024. "Physically consistent deep learning-based day-ahead energy dispatching and thermal comfort control for grid-interactive communities," Applied Energy, Elsevier, vol. 353(PB).
    17. Tan, Zhizhou & Huang, Hui & Lin, Boqiang, 2024. "Impact assessment of the residual lifespan of coal-fired power plants on the investment risk of carbon capture and storage retrofit," Energy, Elsevier, vol. 307(C).
    18. Zhang, Mingming & Song, Wenwen & Liu, Liyun & Zhou, Dequn, 2024. "Optimal investment portfolio strategy for carbon neutrality of power enterprises," Renewable and Sustainable Energy Reviews, Elsevier, vol. 189(PA).
    19. Iria, José & Scott, Paul & Attarha, Ahmad & Gordon, Dan & Franklin, Evan, 2022. "MV-LV network-secure bidding optimisation of an aggregator of prosumers in real-time energy and reserve markets," Energy, Elsevier, vol. 242(C).
    20. Nikpour, Ahmad & Nateghi, Abolfazl & Shafie-khah, Miadreza & Catalão, João P.S., 2021. "Day-ahead optimal bidding of microgrids considering uncertainties of price and renewable energy resources," Energy, Elsevier, vol. 227(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:energy:v:263:y:2023:i:pa:s0360544222025026. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.journals.elsevier.com/energy .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.