A TODIM-Based Investment Decision Framework for Commercial Distributed PV Projects under the Energy Performance Contracting (EPC) Business Model: A Case in East-Central China

Yunna Wu, Jianli Zhou, Yong Hu, Lingwenying Li and Xiaokun Sun
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Yunna Wu: School of Economics and Management, North China Electric Power University, Beijing 102206, China
Jianli Zhou: School of Economics and Management, North China Electric Power University, Beijing 102206, China
Yong Hu: School of Economics and Management, North China Electric Power University, Beijing 102206, China
Lingwenying Li: School of Economics and Management, North China Electric Power University, Beijing 102206, China
Xiaokun Sun: School of Economics and Management, North China Electric Power University, Beijing 102206, China

Energies, 2018, vol. 11, issue 5, 1-27

Abstract: Distributed photovoltaic (DPV) projects have been rapidly proposed in China due to policy promotion, and investment decisions immensely decide the success of DPV projects. This paper aims to propose an investment decision framework for DPV projects under the energy performance contracting (EPC) business model which is currently vigorously promoted in China, thereby improving the efficiency and accuracy of decision making. Firstly, the distinctive criteria system for DPV project investment decision is established, including natural, market, technical, policy, competitive and economic factors. Secondly, the weights of criteria are determined by integrating subjective and objective weights to obtain more accurate weights. Then, the TODIM (an acronym in Portuguese of interactive and multicriteria decision making) approach is utilized to rank the alternative DPV projects, taking into account investors’ psychological behavior. Finally, a case study in central and eastern China is carried out to illustrate the rationality and feasibility of the proposed framework. The results show that the Project A 4 located in Nanchang City is the optimal project, and the rank of alternatives is sensitive to the recession coefficient. This paper provides insightful information for the DPV investors with different risk preferences to evaluate the investment performance of EPC projects and select the most appropriate one under uncertain environment.

Keywords: Distributed Photovoltaic (DPV); Energy Performance Contracting (EPC); Investment Decision; Analytical Network Process (ANP); Multi-criteria Decision-making (MCDM); TODIM (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

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