Optimization of Renewable Energy Investment Costs in the Private Sector Considering Government Support Policies
Keywords:
Renewable Energy, Investment Cost , Energy Production, Game Theory, StackelbergAbstract
Global experience indicates that the implementation of attractive tariff schemes has led to an increased share of bioenergy and renewable energy sources in the energy distribution network. When properly designed, such policies can ensure cost recovery for producers and investors in the renewable energy sector. Accordingly, this paper seeks to propose a model, based on a game theory approach, to maintain the profit levels of stakeholders. In this context, the leader model incorporates government subsidies, while the follower model represents the profit levels of renewable energy producers. The proposed model aims to identify optimal subsidy policies by considering various factors, thereby sustaining the private sector’s motivation to invest in renewable energy production. The results demonstrate that an increase in government support through different policy interventions leads to higher profit margins for companies. On the other hand, as the number of renewable energy producers (companies) grows, the total government subsidies increase, prompting policymakers to implement measures that enhance market competition and thereby reduce corporate profitability.
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Copyright (c) 2025 Hassan Ali Aria, Hamed Kazemipoor, Amir Naser Akhavan, Akbar Alamtabriz (Author)
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