Research on digital transformation strategy of the energy industry based on differential game under the dual-carbon background in China

Digital transformation of the energy industry is at the vanguard of promoting green and low-carbon development of energy, and the transformation and upgrading of the energy industry is a critical path to achieve the goal of "dual carbon." The study takes energy enterprises, digital technology providers, and local governments in China as the research objects, then by constructing a three-party dynamic differential game model, four scenarios are considered respectively. The optimal digitization effort, digitization level, carbon emission reduction expectations, and optimal benefits of each subject are studied. The results show that: (1) Government subsidies function as an effective regulating mechanism, helping regulate the profit distribution of energy enterprises. With government subsidies, cost-sharing contracts can improve the profits of energy enterprises and digital service providers and enhance industry digitization and carbon emission reduction to some extent. (2) When there are government subsidies, the optimal digitalization efforts of energy enterprises and the optimal subsidy coefficient of government under the three decisions are independent of time. The extent to which subsidies improve system members' income is correlated to its game structure and status. (3) In the centralized decision-making state, digitalization level, product emission reduction, and total system profit are higher than in the decentralized decision-making state, which can better help the overall revenue system composed of energy enterprises, digital service providers, and local governments to achieve economic and environmental optimization at the same time and reach the Pareto optimal state. (4) With government subsidies and after the introduction of contracts, when certain conditions are met, the followers' optimal digital effort level, product emission reduction, digitization level, demand and profits of each member are all improved except for the leader's optimal effort level, Pareto improvement of profits of all participating members in the system is realized.