Low carbon transition in climate policy linked distributed energy system

Abstract

Our society has been facing a decentralizing effect on multiscale complexity in low-carbon transitions. The purpose of this work is to evaluate the roles of transaction rate, energy and carbon market regulation, energy consumption and energy capacity in single and one-way climate policy linked system in low carbon transition for distributed energy systems through agent-based simulation. A set of agent behavioral rules for the competition of high and low carbon energies mimics the domestic and exotic local dynamics of the energy production of distributed energy systems and the energy consumption of industrial firms under the impact of energy and carbon market fluctuation. Simulation results show that a single system cannot achieve low carbon transition, while a one-way climate policy linked system can realize low carbon transition. The results also show that the larger high and low energy capacity is, the system is less likely to achieve low carbon transition in the circumstance of the same transaction rate with the constant emission policy bias. Policy implications are drawn regarding the regulation of localized carbon markets in single and climate policy linked systems.