IDEAS home Printed from https://ideas.repec.org/a/eee/renene/v256y2026iphs0960148125022360.html

Exploring behavioral strategies for third-party market cooperation in renewable energy projects: a perspective on addressing climate change

Author

Listed:
  • Zhao, Yinyin
  • Peng, Benhong

Abstract

Third-party market cooperation in renewable energy projects is crucial for addressing the global energy crisis. However, extreme weather events, such as heatwaves, rainstorms, and floods, significantly undermine the resilience of energy infrastructure. The challenge of mitigating the adverse effects of climate change on third-party market cooperation in renewable energy projects has become a global concern. To address the limitations of traditional deterministic evolutionary game models, this study introduces a stochastic evolutionary game model by incorporating Gaussian white noise. This model explores the strategic choices and evolutionary processes of Chinese-funded, foreign-funded, and host-country enterprises, as well as the impact of various climate factors on evolutionary equilibrium and enterprise decision-making. Our findings suggest that the strategic behavior of participants exhibits significant fluctuations under random disturbances. As the intensity of disturbances increases, the amplitude of fluctuations intensifies, while the speed at which participants evolve towards a stable state accelerates. When the probability of climate change shocks exceeds 0.5, the willingness of enterprises to respond to these shocks increases significantly, with Chinese-funded and foreign-funded enterprises demonstrating greater sensitivity. The impact of climate change shock loss proportion on the strategic choices of Chinese-funded and host-country enterprises shows directional consistency. As the proportion of climate change losses increases, both enterprises are more inclined to adopt enhanced strategies. Only when the proportion of climate change shock losses exceeds a certain threshold of 0.2 do foreign-funded enterprises tend to strengthen their strategies. This study provides an important practical foundation for multinational enterprises to formulate climate-adaptive strategies and enhance their ability to mitigate climate change risks in third-party market cooperation for renewable energy projects.

Suggested Citation

  • Zhao, Yinyin & Peng, Benhong, 2026. "Exploring behavioral strategies for third-party market cooperation in renewable energy projects: a perspective on addressing climate change," Renewable Energy, Elsevier, vol. 256(PH).
    • Handle: RePEc:eee:renene:v:256:y:2026:i:ph:s0960148125022360
    DOI: 10.1016/j.renene.2025.124572
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0960148125022360
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.renene.2025.124572?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

    for a different version of it.

    References listed on IDEAS

    as
    1. Zhao, Yabo & Liu, Xiaofeng & Wang, Shaojian & Ge, Yuejing, 2019. "Energy relations between China and the countries along the Belt and Road: An analysis of the distribution of energy resources and interdependence relationships," Renewable and Sustainable Energy Reviews, Elsevier, vol. 107(C), pages 133-144.
    2. Blanford, Geoffrey J., 2009. "R&D investment strategy for climate change," Energy Economics, Elsevier, vol. 31(Supplemen), pages 27-36.
    3. Teng, Minmin & Lv, Kunfeng & Han, Chuanfeng & Liu, Pihui, 2025. "A tripartite stochastic evolutionary game for trading strategies under renewable portfolio standards in China’s electric power industry," Renewable Energy, Elsevier, vol. 240(C).
    4. David E. H. J. Gernaat & Harmen Sytze Boer & Vassilis Daioglou & Seleshi G. Yalew & Christoph Müller & Detlef P. Vuuren, 2021. "Author Correction: Climate change impacts on renewable energy supply," Nature Climate Change, Nature, vol. 11(4), pages 362-362, April.
    5. Daniel Kahneman & Amos Tversky, 2013. "Prospect Theory: An Analysis of Decision Under Risk," World Scientific Book Chapters, in: Leonard C MacLean & William T Ziemba (ed.), HANDBOOK OF THE FUNDAMENTALS OF FINANCIAL DECISION MAKING Part I, chapter 6, pages 99-127, World Scientific Publishing Co. Pte. Ltd..
    6. Chen, Xia & Fu, Qiang & Chang, Chun-Ping, 2021. "What are the shocks of climate change on clean energy investment: A diversified exploration," Energy Economics, Elsevier, vol. 95(C).
    7. Peng, Benhong & Zhao, Yinyin & Elahi, Ehsan & Wan, Anxia, 2023. "Can third-party market cooperation solve the dilemma of emissions reduction? A case study of energy investment project conflict analysis in the context of carbon neutrality," Energy, Elsevier, vol. 264(C).
    8. Hu, Yu & Chi, Yuanying & Zhou, Wenbing & Li, Jialin & Wang, Zhengzao & Yuan, Yongke, 2023. "The interactions between renewable portfolio standards and carbon emission trading in China: An evolutionary game theory perspective," Energy, Elsevier, vol. 271(C).
    9. Li, Junqiang & Ren, Hao & Wang, Mingyue, 2021. "How to escape the dilemma of charging infrastructure construction? A multi-sectorial stochastic evolutionary game model," Energy, Elsevier, vol. 231(C).
    10. Friedman, Daniel, 1991. "Evolutionary Games in Economics," Econometrica, Econometric Society, vol. 59(3), pages 637-666, May.
    11. Wu, Qingyang & Chang, Siqi & Bai, Caiquan & Wei, Wendong, 2023. "How do zombie enterprises hinder climate change action plans in China?," Energy Economics, Elsevier, vol. 124(C).
    12. Lei Gao & Zhen-Yu Zhao, 2018. "System Dynamics Analysis of Evolutionary Game Strategies between the Government and Investors Based on New Energy Power Construction Public-Private-Partnership (PPP) Project," Sustainability, MDPI, vol. 10(7), pages 1-17, July.
    13. Fan, Di & Cui, Lin & Li, Yi & Zhu, Cherrie J., 2016. "Localized learning by emerging multinational enterprises in developed host countries: A fuzzy-set analysis of Chinese foreign direct investment in Australia," International Business Review, Elsevier, vol. 25(1), pages 187-203.
    14. Anuja Shaktawat & Shelly Vadhera, 2021. "Risk management of hydropower projects for sustainable development: a review," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 23(1), pages 45-76, January.
    15. Egli, Florian, 2020. "Renewable energy investment risk: An investigation of changes over time and the underlying drivers," Energy Policy, Elsevier, vol. 140(C).
    16. Mingchen Duan & Yi Duan, 2023. "Research on Oil and Gas Energy Cooperation between China and Central-North Asian Countries under the “One Belt and One Road” Strategy," Energies, MDPI, vol. 16(21), pages 1-17, October.
    17. Zhao, Yinyin & Peng, Benhong, 2025. "Exploring modes of third-party market cooperation in energy projects: A strategic approach to addressing climate change," Energy Policy, Elsevier, vol. 206(C).
    18. Yang, Bo & Swe, Thidar & Chen, Yixuan & Zeng, Chunyuan & Shu, Hongchun & Li, Xin & Yu, Tao & Zhang, Xiaoshun & Sun, Liming, 2021. "Energy cooperation between Myanmar and China under One Belt One Road: Current state, challenges and perspectives," Energy, Elsevier, vol. 215(PB).
    19. David E. H. J. Gernaat & Harmen Sytze Boer & Vassilis Daioglou & Seleshi G. Yalew & Christoph Müller & Detlef P. Vuuren, 2021. "Climate change impacts on renewable energy supply," Nature Climate Change, Nature, vol. 11(2), pages 119-125, February.
    20. A. T. D. Perera & Vahid M. Nik & Deliang Chen & Jean-Louis Scartezzini & Tianzhen Hong, 2020. "Quantifying the impacts of climate change and extreme climate events on energy systems," Nature Energy, Nature, vol. 5(2), pages 150-159, February.
    21. Botond Kőszegi & Matthew Rabin, 2006. "A Model of Reference-Dependent Preferences," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 121(4), pages 1133-1165.
    22. Junqiang Li & Hao Ren & Changcheng Zhang & Qingxia Li & Kaifeng Duan, 2020. "Substantive Innovation or Strategic Innovation? Research on Multiplayer Stochastic Evolutionary Game Model and Simulation," Complexity, Hindawi, vol. 2020, pages 1-15, April.
    23. Michael A Witt & Arie Y Lewin, 2007. "Outward foreign direct investment as escape response to home country institutional constraints," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 38(4), pages 579-594, July.
    24. Karunathilake, Hirushie & Hewage, Kasun & Prabatha, Tharindu & Ruparathna, Rajeev & Sadiq, Rehan, 2020. "Project deployment strategies for community renewable energy: A dynamic multi-period planning approach," Renewable Energy, Elsevier, vol. 152(C), pages 237-258.
    25. Yu, Donghui & Gu, Baihe & Zhu, Kaiwei & Yang, Jiawen & Sheng, Yuhui, 2024. "Risk analysis of China's renewable energy cooperation with belt and road economies," Energy, Elsevier, vol. 293(C).
    26. Blyth, William & Bradley, Richard & Bunn, Derek & Clarke, Charlie & Wilson, Tom & Yang, Ming, 2007. "Investment risks under uncertain climate change policy," Energy Policy, Elsevier, vol. 35(11), pages 5766-5773, November.
    27. Kai Liu & Qianzhi Wang & Ming Wang & Elco E. Koks, 2023. "Global transportation infrastructure exposure to the change of precipitation in a warmer world," Nature Communications, Nature, vol. 14(1), pages 1-9, December.
    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. Kapica, Jacek & Jurasz, Jakub & Canales, Fausto A. & Bloomfield, Hannah & Guezgouz, Mohammed & De Felice, Matteo & Zbigniew, Kobus, 2024. "The potential impact of climate change on European renewable energy droughts," Renewable and Sustainable Energy Reviews, Elsevier, vol. 189(PA).
    2. Dai, Zhifeng & Hu, Juan & Liu, Xinheng & Yang, Mi, 2024. "ynamic time-domain and frequency-domain spillovers and portfolio strategies between climate change attention and energy-relevant markets," Energy Economics, Elsevier, vol. 134(C).
    3. Sinha, Avik & Tiwari, Sunil & Saha, Tanaya, 2024. "Modeling the behavior of renewable energy market: Understanding the moderation of climate risk factors," Energy Economics, Elsevier, vol. 130(C).
    4. Liang, Chao & Umar, Muhammad & Ma, Feng & Huynh, Toan L.D., 2022. "Climate policy uncertainty and world renewable energy index volatility forecasting," Technological Forecasting and Social Change, Elsevier, vol. 182(C).
    5. Du, Kang & Fan, Ruguo & Wang, Dongxue, 2025. "Coupling effects of RPS and CET policies on the low-carbon transformation of the Chinese power industry: A combined perspective based on tripartite evolutionary game and system dynamics," Energy, Elsevier, vol. 334(C).
    6. Cheng, Jixin & Yang, Dingjian & Xu, Lan, 2025. "Digital economy, technical progress reversal, and climate change governance–insights on digital technology and data factor," Energy Economics, Elsevier, vol. 150(C).
    7. Lan, Yong & Gao, Hanxiao & Zhou, Ping & Zhang, Hua & Li, Hailing, 2025. "The impact of climate risks on global energy production and consumption: New evidence from causality-in-quantile and wavelet analysis," Energy, Elsevier, vol. 319(C).
    8. Kuang, Zhonghong & Chen, Qi & Yu, Yang, 2022. "Assessing the CO2-emission risk due to wind-energy uncertainty," Applied Energy, Elsevier, vol. 310(C).
    9. Aall, Carlo & Chang, Miguel & Elliot, Thomas & Holm, Tara Botnen & Løkke, Søren & Mati, Alessandro & Mayer, Stephanie & Skov, Iva Ridjan, 2025. "Overlooked climate risks in the ongoing renewable energy transitions," Energy, Elsevier, vol. 335(C).
    10. Yang, Jingna & Zhou, Kaile & Hu, Rong, 2024. "City-level resilience assessment of integrated energy systems in China," Energy Policy, Elsevier, vol. 193(C).
    11. Long, Yunxia & Chen, Yaning & Xu, Changchun & Li, Zhi & Zhu, Jianyu & Liu, Yongchang & Wang, Hongyu, 2025. "Enhancing and stabilizing effects of low-carbon models on the synergistic benefits of wind and solar energy: Evidence from China," Applied Energy, Elsevier, vol. 395(C).
    12. Plaga, Leonie Sara & Bertsch, Valentin, 2023. "Methods for assessing climate uncertainty in energy system models — A systematic literature review," Applied Energy, Elsevier, vol. 331(C).
    13. Wan, Kaidi & Fan, Ying & Liu, Bing-Yue, 2025. "Energy supply resilience under low-carbon transition: Long-term multi-national assessment," Energy, Elsevier, vol. 326(C).
    14. Liu, Pingkuo & Sun, Qianhui & Zhang, Yingjie, 2025. "Thermal power emission reduction behavior considering dynamic cost: contract cooperation in stochastic evolutionary game," Energy, Elsevier, vol. 333(C).
    15. Donald R. Noble & Shona Pennock & Daniel Coles & Timur Delahaye & Henry Jeffrey, 2025. "Quantifying the System Benefits of Ocean Energy in the Context of Variability: A UK Example," Energies, MDPI, vol. 18(14), pages 1-24, July.
    16. Shunda, Nicholas, 2009. "Auctions with a buy price: The case of reference-dependent preferences," Games and Economic Behavior, Elsevier, vol. 67(2), pages 645-664, November.
    17. Castilla, Carolina & Haab, Timothy C., 2010. "Asymmetric Search and Loss Aversion: Choice Experiment on Consumer Willingness to Search in the Gasoline Retail Market," 2010 Annual Meeting, July 25-27, 2010, Denver, Colorado 61672, Agricultural and Applied Economics Association.
    18. Carolin Bock & Maximilian Schmidt, 2015. "Should I stay, or should I go? – How fund dynamics influence venture capital exit decisions," Review of Financial Economics, John Wiley & Sons, vol. 27(1), pages 68-82, November.
    19. Damgaard, Mette Trier & Nielsen, Helena Skyt, 2018. "Nudging in education," Economics of Education Review, Elsevier, vol. 64(C), pages 313-342.
    20. Karle, Heiko & Schumacher, Heiner & Vølund, Rune, 2023. "Consumer loss aversion and scale-dependent psychological switching costs," Games and Economic Behavior, Elsevier, vol. 138(C), pages 214-237.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    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:renene:v:256:y:2026:i:ph:s0960148125022360. 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/renewable-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.