Multidimensional Impact Assessment of Social Welfare Incorporating Dynamic Cross Subsidy and Tiered Carbon Trading

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Authors: Ya-Juan Cao, Bin-Yang Qiu, Qiu-Jie Wang, Yi-Hui Luo, Yun-Xiang Zhang
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Abstract

In the context of advancing two pivotal national commitments, namely the “Dual Carbon” goals and the common prosperity strategy, energy policy formulation must move beyond purely economic or environmental considerations and adopt integrated social welfare assessments. This study develops an optimal dispatch model for a multi-microgrid system that incorporates dynamic cross subsidy and tiered carbon trading. From the perspective of welfare economics, the socioeconomic impacts of the proposed model are then systematically evaluated. First, a unified operational framework is established, combining dynamic electricity tariff cross subsidy with a tiered carbon trading mechanism. Next, a quantitative model for electricity tariff cross subsidy is proposed, and a dynamic subsidy rate linked to renewable energy output is designed to guide electricity consumption behavior. Finally, a comparative simulation is conducted across three scenarios: no subsidy, traditional cross subsidy, and the proposed dynamic cross subsidy. The results demonstrate that the proposed dynamic mechanism reduces system carbon emissions by 17.05% compared to the non-subsidy baseline while significantly optimizing total costs.

Fields of Study & Subjects

Electric Power System Optimization Renewable energy and sustainable power systems Integrated Energy Systems Optimization

Publication details

Journal / source
Energies
Volume
19
Issue
5
Pages
1225–1225
Publication date
28 February 2026
Language
EN