by Songlin Tang
Jinan, China (SPX) Jan 13, 2026
As global energy transitions accelerate, distributed photovoltaic systems have become a cornerstone of rural energy transformation in China, shifting many rural households from passive energy consumers to active prosumers.
A research team from the School of Economics at Shandong Technology and Business University has developed a multi agent dynamic game model to analyze how key stakeholders in rural distributed PV systems interact and make strategic decisions.
The model focuses on four core stakeholders in the rural PV ecosystem: village organizations, PV enterprises, grid companies, and rural households, capturing their different incentives and constraints within a unified analytical framework.
“The rural distributed PV ecosystem is a complex network of interactions,” said corresponding author Songlin Tang. “Our model captures the heterogeneity of rural households and the critical role of grid companies, filling gaps in previous research that overlooked these key factors.”
Scenario simulations using the model yielded three main insights for rural PV development, starting with the importance of collaboration between PV enterprises and village organizations to promote the surplus electricity feed in model.
The analysis indicates that rural households with low electricity demand tend to prefer a full feed in model where all generated electricity is supplied to the grid, while higher demand households favor the surplus feed in approach that supports self consumption alongside grid sales.
A second finding warns that aggressive promotion of the surplus electricity feed in model can increase the risk of curtailment, particularly when grid capacity and household demand are not aligned with growing installed capacity.
“Increasing self consumption requirements helps reduce waste, but it may also limit total installed capacity,” Tang explained. “Finding the right balance is essential for efficient energy use.”
The third major finding highlights that rising rural household incomes support greater investment in surplus electricity feed in projects, but physical grid capacity ultimately constrains the efficiency and scale of this investment.
According to the study, grid upgrades that are not matched by corresponding growth in electricity demand lead to inefficient use of capital, reinforcing the conclusion that grid capacity remains the decisive factor for long term development.
The researchers tested multiple strategy combinations and concluded that PV enterprises generally achieve higher profitability through equipment sales rather than direct long term project investment in rural areas.
Village organizations benefit more when they cooperate closely with PV enterprises on promotion and project organization, using their local knowledge to reduce information asymmetry and accelerate adoption among households.
Sensitivity analyses in the study show that both household income and grid upgrade costs play pivotal roles in shaping adoption patterns, investment choices, and curtailment risks across different household types.
Higher income households are more willing to invest in PV systems under the surplus feed in model, while low income households that adopt this model face a greater likelihood of curtailment because their lower electricity demand leaves more surplus energy exposed to grid constraints.
“The study provides a scientific basis for policy design,” Tang said. “We recommend deepening village enterprise cooperation, establishing dynamic self consumption ratio mechanisms based on grid capacity, and implementing regionally differentiated development strategies.”
The team expects that targeted cooperation mechanisms can help tailor project structures to local conditions, including differences in income levels, load profiles, and grid capabilities among rural regions.
Looking ahead, the researchers plan to expand the game model to include evolving policy subsidy frameworks and the increasing role of energy storage technologies in smoothing generation and demand mismatches.
They also aim to conduct empirical tests in specific rural regions, using real world project data to validate and refine the model’s assumptions and to better translate the theoretical findings into practical recommendations for rural energy planners.
This research was supported by the General Project of the National Social Science Fund of China, “Research on the Pathway of Rural Energy Transition in China from the Prosumer Perspective” (21BJY113), and by the Scientific Research Start up Fund Project of Shandong Technology and Business University, “Mechanism and Pathway of Low carbon Transition in the Power Sector from a Regional Coordination Perspective” (306657).
Research Report:Research on the behavioral mechanisms of rural distributed photovoltaic development: A view of prosumer perspective
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