IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v16y2024i20p8965-d1500140.html
   My bibliography  Save this article

Cooperation and Profit Allocation Mechanism of Traditional and New Energy Complementary Power Generation: A Framework for Renewable Portfolio Standards

Author

Listed:
  • Bo Shang

    (School of Business, Changzhou University, Changzhou 213159, China)

Abstract

To boost the sustainable development of energy and the environment, a new power system with clean energy sources has been proposed by the Chinese government and traditional coal-fired power units are being transformed into regulation service providers for this new energy power system. Then, in this study, complementary power generation cooperation between traditional coal-fired power and new energy power producers is analyzed and discussed, and the energy quota agents, power sellers, are also included. Based on the cooperation game idea, different decision-making models of the tripartite power entities are elaborately constructed. Then, according to the price linkage mechanism between new energy and traditional thermal power, the profit of all power subjects is calculated and the profit allocation process is also analyzed. The conclusions show that the similarity of the two wholesale power price coefficients verifies the symmetry of the cooperative status of power producers. For BPC and SPC quota patterns, for example, BPC is bundled with new energy power and green certificates, whereas SPC is separate. Under the SPC pattern, there is a critical value for effective cooperation between the two power producers in the price range of traditional thermal power or new energy, which can achieve a win–win situation of increasing economic benefits and the consumption scale. Under the BPC pattern, the dynamic benefit compensation mechanism, which is the corrected Shapley value based on the RPS quota ratio, can solve the compressed profit of traditional coal-fired power producers. In contrast, the overall effect of profit allocation using the nucleolar method is not ideal. This study aims to give full play to the elastic induction effect of RPS to promote the sustainable transformation of traditional thermal power energy, especially combining the market mechanism to encourage traditional coal-fired power units to improve green technology to advance the construction of the green power market in China.

Suggested Citation

  • Bo Shang, 2024. "Cooperation and Profit Allocation Mechanism of Traditional and New Energy Complementary Power Generation: A Framework for Renewable Portfolio Standards," Sustainability, MDPI, vol. 16(20), pages 1-29, October.
    • Handle: RePEc:gam:jsusta:v:16:y:2024:i:20:p:8965-:d:1500140
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/16/20/8965/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/16/20/8965/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Dávid Csercsik, 2016. "Competition and Cooperation in a Bidding Model of Electrical Energy Trade," Networks and Spatial Economics, Springer, vol. 16(4), pages 1043-1073, December.
    2. Zhen, Juntao & Zhao, Laijun & Yi, Hongru & Cheng, Youfeng & Wang, Ke & Hu, Haisheng, 2024. "Cross-provincial collaborative transaction that considers both the green electricity and the green certificate markets under a renewable portfolio standard policy," Applied Energy, Elsevier, vol. 372(C).
    3. Pineda, Salvador & Bock, Andreas, 2016. "Renewable-based generation expansion under a green certificate market," Renewable Energy, Elsevier, vol. 91(C), pages 53-63.
    4. Xiao, Yunpeng & Wang, Xifan & Wang, Xiuli & Dang, Can & Lu, Ming, 2016. "Behavior analysis of wind power producer in electricity market," Applied Energy, Elsevier, vol. 171(C), pages 325-335.
    5. Bhattacharya, Suparna & Giannakas, Konstantinos & Schoengold, Karina, 2017. "Market and welfare effects of renewable portfolio standards in United States electricity markets," Energy Economics, Elsevier, vol. 64(C), pages 384-401.
    6. Furlan, Claudia & Mortarino, Cinzia, 2018. "Forecasting the impact of renewable energies in competition with non-renewable sources," Renewable and Sustainable Energy Reviews, Elsevier, vol. 81(P2), pages 1879-1886.
    7. Wu, Qiong & Ren, Hongbo & Gao, Weijun & Ren, Jianxing, 2017. "Benefit allocation for distributed energy network participants applying game theory based solutions," Energy, Elsevier, vol. 119(C), pages 384-391.
    8. Ding, Yihong & Tan, Qinliang & Shan, Zijing & Han, Jian & Zhang, Yimei, 2023. "A two-stage dispatching optimization strategy for hybrid renewable energy system with low-carbon and sustainability in ancillary service market," Renewable Energy, Elsevier, vol. 207(C), pages 647-659.
    9. Volkart, Kathrin & Weidmann, Nicolas & Bauer, Christian & Hirschberg, Stefan, 2017. "Multi-criteria decision analysis of energy system transformation pathways: A case study for Switzerland," Energy Policy, Elsevier, vol. 106(C), pages 155-168.
    10. Li, Wei & Lu, Can & Zhang, Yan-Wu, 2019. "Prospective exploration of future renewable portfolio standard schemes in China via a multi-sector CGE model," Energy Policy, Elsevier, vol. 128(C), pages 45-56.
    11. Su, Xiang & Tan, Junlan, 2023. "Regional energy transition path and the role of government support and resource endowment in China," Renewable and Sustainable Energy Reviews, Elsevier, vol. 174(C).
    12. Fischer-Kowalski, Marina & Rovenskaya, Elena & Krausmann, Fridolin & Pallua, Irene & Mc Neill, John R., 2019. "Energy transitions and social revolutions," Technological Forecasting and Social Change, Elsevier, vol. 138(C), pages 69-77.
    13. Fan, Jing-Li & Wang, Jia-Xing & Hu, Jia-Wei & Wang, Yu & Zhang, Xian, 2019. "Optimization of China’s provincial renewable energy installation plan for the 13th five-year plan based on renewable portfolio standards," Applied Energy, Elsevier, vol. 254(C).
    14. Webb, Jeremy & de Silva, H. Nadeeka & Wilson, Clevo, 2020. "The future of coal and renewable power generation in Australia: A review of market trends," Economic Analysis and Policy, Elsevier, vol. 68(C), pages 363-378.
    Full references (including those not matched with items on IDEAS)

    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. Xu, Jie & Lv, Tao & Hou, Xiaoran & Deng, Xu & Liu, Feng, 2021. "Provincial allocation of renewable portfolio standard in China based on efficiency and fairness principles," Renewable Energy, Elsevier, vol. 179(C), pages 1233-1245.
    2. Ying, Zhou & Xin-gang, Zhao & Xue-feng, Jia & Zhen, Wang, 2021. "Can the Renewable Portfolio Standards improve social welfare in China's electricity market？," Energy Policy, Elsevier, vol. 152(C).
    3. Xin-gang, Zhao & Lei, Xu & Ying, Zhou, 2022. "How to promote the effective implementation of China’s Renewable Portfolio Standards considering non-neutral technology?," Energy, Elsevier, vol. 238(PB).
    4. Libo Zhang & Qian Du & Dequn Zhou, 2021. "Grid Parity Analysis of China’s Centralized Photovoltaic Generation under Multiple Uncertainties," Energies, MDPI, vol. 14(7), pages 1-19, March.
    5. Yuanyuan He & Luxin Wan & Manli Zhang & Huijuan Zhao, 2022. "Regional Renewable Energy Installation Optimization Strategies with Renewable Portfolio Standards in China," Sustainability, MDPI, vol. 14(17), pages 1-18, August.
    6. Zhou, Dequn & Dong, Zhuojia & Sang, Xiuzhi & Wang, Qunwei & Yu, Xianyu, 2023. "Do feed-in tariff reduction and green certificate trading effectively promote regional sustainable development？," Energy, Elsevier, vol. 283(C).
    7. Xin-gang, Zhao & Yi, Zuo & Hui, Wang & Zhen, Wang, 2022. "How can the cost and effectiveness of renewable portfolio standards be coordinated? Incentive mechanism design from the coevolution perspective," Renewable and Sustainable Energy Reviews, Elsevier, vol. 158(C).
    8. Ying, Zhou & Xin-gang, Zhao & Lei, Xu, 2022. "Supply side incentive under the Renewable Portfolio Standards: A perspective of China," Renewable Energy, Elsevier, vol. 193(C), pages 505-518.
    9. Li, Kai & Tan, Xiujie & Yan, Yaxue & Jiang, Dalin & Qi, Shaozhou, 2022. "Directing energy transition toward decarbonization: The China story," Energy, Elsevier, vol. 261(PA).
    10. Song, Xiao-hua & Han, Jing-jing & Zhang, Lu & Zhao, Cai-ping & Wang, Peng & Liu, Xiao-yan & Li, Qiao-chu, 2021. "Impacts of renewable portfolio standards on multi-market coupling trading of renewable energy in China: A scenario-based system dynamics model," Energy Policy, Elsevier, vol. 159(C).
    11. Dong, Zhuojia & Yu, Xianyu & Chang, Ching-Ter & Zhou, Dequn & Sang, Xiuzhi, 2022. "How does feed-in tariff and renewable portfolio standard evolve synergistically? An integrated approach of tripartite evolutionary game and system dynamics," Renewable Energy, Elsevier, vol. 186(C), pages 864-877.
    12. Amiri-Pebdani, Sima & Alinaghian, Mahdi & Khosroshahi, Hossein, 2023. "A game theoretic approach for time-of-use pricing with considering renewable portfolio standard effects and investment in energy storage technologies under government interventions," Energy, Elsevier, vol. 282(C).
    13. Zeng, Lijun & Wang, Jiafeng & Zhao, Laijun, 2022. "An inter-provincial tradable green certificate futures trading model under renewable portfolio standard policy," Energy, Elsevier, vol. 257(C).
    14. Yan, Yue & Sun, Mei & Guo, Zhilong, 2022. "How do carbon cap-and-trade mechanisms and renewable portfolio standards affect renewable energy investment?," Energy Policy, Elsevier, vol. 165(C).
    15. Zeng, Lijun & Du, Wenjing & Zhao, Laijun & Zhan, Yanhong, 2023. "An inter-provincial transfer fee model under renewable portfolio standard policy," Energy, Elsevier, vol. 277(C).
    16. Bao, Xiongjiantao & Zhao, Wenhui & Wang, Xiaomei & Tan, Zhongfu, 2019. "Impact of policy mix concerning renewable portfolio standards and emissions trading on electricity market," Renewable Energy, Elsevier, vol. 135(C), pages 761-774.
    17. Weiqiang Zhu & Yun Zhang, 2024. "Household Energy Clean Transition Mechanisms under Market Failures: A Government Financing Perspective," Sustainability, MDPI, vol. 16(13), pages 1-29, July.
    18. Dávid Csercsik & László Á. Kóczy, 2017. "Efficiency and Stability in Electrical Power Transmission Networks: a Partition Function Form Approach," Networks and Spatial Economics, Springer, vol. 17(4), pages 1161-1184, December.
    19. Sun, J. & Wen, W. & Wang, M. & Zhou, P., 2022. "Optimizing the provincial target allocation scheme of renewable portfolio standards in China," Energy, Elsevier, vol. 250(C).
    20. Bessi, Alessandro & Guidolin, Mariangela & Manfredi, Piero, 2021. "The role of gas on future perspectives of renewable energy diffusion: Bridging technology or lock-in?," Renewable and Sustainable Energy Reviews, Elsevier, vol. 152(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:gam:jsusta:v:16:y:2024:i:20:p:8965-:d:1500140. 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: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    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.