Using Bargaining-Game Theory For Benefit Allocation In Shared Savings Energy Performance Contracting

Energy saving and emission reduction is the core link of transformation of the economic development mode, and it needs to be resolved urgently in contemporary China. As a kind of brand new mechanism based on market, Energy Performance Contracting (EPC) is very important for energy saving and emission reduction. Currently, the Chinese government promulgated a series of related policies and regulations to promote the development of EPC in China. Now, it is developing rapidly. However, it also confronted with many problems, one of which is the energy savings allocation between the Client and the ESCo in Shared Savings EPC. It is very significant to appraise the problem to further investigate and propose practical methods.Currently, the studies on this problem are mainly adopting the equilibrium principle of gains and risks and benefit allocation according to contributes in Dynamic Alliance, which both have their own limitations. The negotiation between the Client and the ESCo for energy savings allocation is, in fact, a bargaining process. This thesis examines this bargaining process by using Rubinstein bargaining-game theory, and introduces a method called energy savings allocation bargaining model to provide a new way and quantitative method for this problem.The connotation of shared savings EPC, sharing pattern and operational process are firstly expounded in this thesis. Rubinstein bargaining-game theory is introduced to study this problem after analyzing and comprising the relative benefits allocation methods. Then, it is pointed out that the energy savings should firstly satisfy the costs of both sides, and the object of benefit allocation is the NPV of the energy saving project which discounted at the discount rate considering bank interest and inflation. The effective bargaining interval is obtained through respectively analyzing of The Client and the ESCo. Consequently, the problem of"what to allocate"is resolved. Finally, energy savings allocation bargaining model is set up. In this model, the both sides'equilibrium offer strategy is analyzed, and considers them to be the top and bottom limitation of the new interval, and through discussing the top and the bottom limitation this thesis points out the bargaining strategies and benefit allotment of both sides. And then sharing duration and proportion could be determined based on the benefit allotment considering the time value of money and risk factors. Consequently, the problem of"How to allocate"is resolved. Also this thesis analyzed the discount factor of the bargaining model and conducted application research combined with instances.