The Impact of Carbon Trading Market on the Layout Decision of Renewable Energy Investment—Theoretical Modeling and Case Study
The Carbon Emissions Trading System (ETS) serves as a market-based mechanism to drive renewable energy (RE) investments, yet its heterogeneous impacts on different stakeholders remain underexplored. This paper treats the carbon market as an exogenous shock and develops a multi-agent equilibrium mode...
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| Format: | Article |
| Language: | English |
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MDPI AG
2025-07-01
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| Series: | Energies |
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| Online Access: | https://www.mdpi.com/1996-1073/18/15/3950 |
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| _version_ | 1849406076165816320 |
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| author | Ning Yan Shenhai Huang Yan Chen Daini Zhang Qin Xu Xiangyi Yang Shiyan Wen |
| author_facet | Ning Yan Shenhai Huang Yan Chen Daini Zhang Qin Xu Xiangyi Yang Shiyan Wen |
| author_sort | Ning Yan |
| collection | DOAJ |
| description | The Carbon Emissions Trading System (ETS) serves as a market-based mechanism to drive renewable energy (RE) investments, yet its heterogeneous impacts on different stakeholders remain underexplored. This paper treats the carbon market as an exogenous shock and develops a multi-agent equilibrium model incorporating carbon pricing, encompassing power generation enterprises, power transmission enterprises, power consumers, and the government, to analyze how carbon prices reshape RE investment layouts under dual-carbon goals. Using panel data from Zhejiang Province (2017–2022), a high-energy-consumption region with 25% net electricity imports, we simulate heterogeneous responses of agents to carbon price fluctuations (CNY 50–250/ton). The results show that RE on-grid electricity increases (+0.55% to +2.89%), while thermal power declines (–4.98% to −15.39%) on the generation side. Transmission-side RE sales rise (+3.25% to +9.74%), though total electricity sales decrease (−0.49% to −2.22%). On the consumption side, RE self-generation grows (+2.12% to +5.93%), yet higher carbon prices reduce overall utility (−0.44% to −2.05%). Furthermore, external electricity integration (peaking at 28.5% of sales in 2020) alleviates provincial entities’ carbon cost pressure under high carbon prices. This study offers systematic insights for renewable energy investment decisions and policy optimization. |
| format | Article |
| id | doaj-art-79862350d54245ea9cb2116a5c046428 |
| institution | Kabale University |
| issn | 1996-1073 |
| language | English |
| publishDate | 2025-07-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Energies |
| spelling | doaj-art-79862350d54245ea9cb2116a5c0464282025-08-20T03:36:31ZengMDPI AGEnergies1996-10732025-07-011815395010.3390/en18153950The Impact of Carbon Trading Market on the Layout Decision of Renewable Energy Investment—Theoretical Modeling and Case StudyNing Yan0Shenhai Huang1Yan Chen2Daini Zhang3Qin Xu4Xiangyi Yang5Shiyan Wen6Jiaxing Hengchuang Electric Power Design & Institute Co., Ltd., Jiaxing 314100, ChinaJiaxing Hengchuang Electric Power Design & Institute Co., Ltd., Jiaxing 314100, ChinaJiaxing Hengchuang Electric Power Design & Institute Co., Ltd., Jiaxing 314100, ChinaJiaxing Hengchuang Electric Power Design & Institute Co., Ltd., Jiaxing 314100, ChinaSchool of Economics and Finance, Xi’an Jiaotong University, Xi’an 710049, ChinaSchool of Economics and Finance, Xi’an Jiaotong University, Xi’an 710049, ChinaSchool of Economics, Xi’an University of Finance and Economics, Xi’an 710003, ChinaThe Carbon Emissions Trading System (ETS) serves as a market-based mechanism to drive renewable energy (RE) investments, yet its heterogeneous impacts on different stakeholders remain underexplored. This paper treats the carbon market as an exogenous shock and develops a multi-agent equilibrium model incorporating carbon pricing, encompassing power generation enterprises, power transmission enterprises, power consumers, and the government, to analyze how carbon prices reshape RE investment layouts under dual-carbon goals. Using panel data from Zhejiang Province (2017–2022), a high-energy-consumption region with 25% net electricity imports, we simulate heterogeneous responses of agents to carbon price fluctuations (CNY 50–250/ton). The results show that RE on-grid electricity increases (+0.55% to +2.89%), while thermal power declines (–4.98% to −15.39%) on the generation side. Transmission-side RE sales rise (+3.25% to +9.74%), though total electricity sales decrease (−0.49% to −2.22%). On the consumption side, RE self-generation grows (+2.12% to +5.93%), yet higher carbon prices reduce overall utility (−0.44% to −2.05%). Furthermore, external electricity integration (peaking at 28.5% of sales in 2020) alleviates provincial entities’ carbon cost pressure under high carbon prices. This study offers systematic insights for renewable energy investment decisions and policy optimization.https://www.mdpi.com/1996-1073/18/15/3950carbon pricecarbon trading marketinvestment entitiesrenewable energy generationrenewable energy investment |
| spellingShingle | Ning Yan Shenhai Huang Yan Chen Daini Zhang Qin Xu Xiangyi Yang Shiyan Wen The Impact of Carbon Trading Market on the Layout Decision of Renewable Energy Investment—Theoretical Modeling and Case Study Energies carbon price carbon trading market investment entities renewable energy generation renewable energy investment |
| title | The Impact of Carbon Trading Market on the Layout Decision of Renewable Energy Investment—Theoretical Modeling and Case Study |
| title_full | The Impact of Carbon Trading Market on the Layout Decision of Renewable Energy Investment—Theoretical Modeling and Case Study |
| title_fullStr | The Impact of Carbon Trading Market on the Layout Decision of Renewable Energy Investment—Theoretical Modeling and Case Study |
| title_full_unstemmed | The Impact of Carbon Trading Market on the Layout Decision of Renewable Energy Investment—Theoretical Modeling and Case Study |
| title_short | The Impact of Carbon Trading Market on the Layout Decision of Renewable Energy Investment—Theoretical Modeling and Case Study |
| title_sort | impact of carbon trading market on the layout decision of renewable energy investment theoretical modeling and case study |
| topic | carbon price carbon trading market investment entities renewable energy generation renewable energy investment |
| url | https://www.mdpi.com/1996-1073/18/15/3950 |
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