Renewable energy communities and the ecological transition: A game theoretic bargaining approach

Leonardo Becchetti and Francesco Salustri

Utilities Policy, 2025, vol. 96, issue C

Abstract: Renewable energy communities (RECs) are considered a key initiative for ecological transition by international institutions and policymakers. In our article, we analyze how RECs enhance cooperation in ecological transition with a game-theoretic approach. Depending on specific conditions, the interaction among RECs members can be modeled through a Prisoner’s Dilemma or a game where cooperation is the only equilibrium. A REC creates incentives for cooperation through three primary revenue sources: cost savings from self-produced and consumed energy, surplus energy sales, and government incentives. We identify the combination of these factors that leads to a cooperative Nash equilibrium, where the dominant strategy for prosumers is to create a REC with passive consumers.

Keywords: Energy communities; Renewable energy; Energy policy; Environmental policy (search for similar items in EconPapers)
JEL-codes: D16 Q20 Q48 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:juipol:v:96:y:2025:i:c:s0957178725001213

DOI: 10.1016/j.jup.2025.102006

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