Carbon-Driven Incentive Mechanism for Renewable Power-to-Ammonia Production in Coupled Carbon and Ammonia Markets

Unofficial AI-generated summary based on the public title and abstract. Not an official translation.

🔬研究者:Provides a rigorous equilibrium model for integrating carbon markets with renewable ammonia production, useful for further research on multi-market interactions.

🏢実務担当者:Offers insights into how carbon pricing mechanisms can be structured to improve the business case for renewable ammonia projects, aiding investment decisions.

🏛政策担当者:Highlights the potential of carbon-driven incentives to reduce emissions without significant economic loss, informing carbon market design and clean energy policies.

Renewable power-to-ammonia (ReP2A) production offers a promising pathway to decarbonize the power, transport and, chemical sectors, yet its competitiveness remains limited by high costs and fragmented carbon-policy frameworks. In particular, a unified mechanism that links ReP2A producers with fossil-based gray ammonia (GA) competitors in carbon and ammonia markets, while coordinating incentives among renewable generation, hydrogen production, and ammonia synthesis stakeholders in the ReP2A process chain, is still lacking. To address this gap, this paper proposes a hierarchical carbon-driven incentive mechanism (PCIM) that integrates carbon policy with multi-energy market interactions. A two-layer trading framework is developed, where ReP2A and GA compete in carbon allowance (CA) and ammonia markets (outer layer), while electricity and hydrogen transactions coordinate the ReP2A chain (inner layer). The resulting interactions are modeled as a hierarchical equilibrium, where the inner layer is reformulated as a tractable equivalent optimization problem, and the outer layer is solved as a mixed-integer linear program (MILP) derived from Karush-Kuhn-Tucker conditions. Based on equilibrium analysis, the carbon-related revenue of ReP2A is quantified, and a CA allocation mechanism (PCAM) is proposed to ensure individually rationality among stakeholders. Results show that the proposed mechanism reduces carbon emissions by 12.9% with only a 1.8% decrease in sector-wide revenue. Moreover, carbon pricing under the proposed framework redistributes profits between green and gray ammonia without reducing total welfare, and the PCAM further enhances stakeholders' willingness to participate in ReP2A production.

• openalex https://doi.org/10.48550/arxiv.2604.03728first seen 2026-05-17 06:59:00 · last seen 2026-05-19 05:08:49
• semanticscholar https://doi.org/10.48550/arxiv.2604.03728first seen 2026-06-18 06:05:28 · last seen 2026-08-02 06:14:34