Comparison of two strategies of reward-penalty mechanism for promoting net zero energy buildings

Yuehong Lu, Zafar A. Khan, Hasan Gunduz, Changlong Wang, Muhammad Imran, Imran Qureshi

Research output: Contribution to journalArticlepeer-review


Due to reduction of feed in tariff, the exploration of design solutions for smart cost-effective energy system is required to enable the consumers to select the optimum capacity of renewable energy system. This study investigates an innovative reward-penalty mechanism which is specifically designed to promote net zero energy buildings and net zero energy communities. Two different strategies (i.e. the building-level-based strategy and the community-level-based strategy) are developed regarding the application of the proposed reward-penalty mechanism. The electricity loads of family-houses in Ireland ranging from 1,286 kWh/y to 36,802 kWh/y are used to study the effect of the proposed strategies. The results show that both strategies lead to a similar cost versus zero-energy-building level relationship, i.e. a higher profit is related to a higher zero-energy-building level whilst a heavier financial penalty is related to a lower zero-energy-building level. The difference between the costs for the entire community (100 family-houses) predicted by the two different strategies is observed to be less than 10%. The building-level-based strategy is observed to produce the change rate of cost versus zero-energy-building level curve that often deviates significantly from the expected parabolic curve designed in this study, thus the community-level-based strategy provides an advantage over the building-level-based strategy. In addition, the Monte Carlo sampling method is used to quantify the uncertainty of the proposed reward-penalty function.
Original languageEnglish
Article number101347
JournalSustainable Energy Technologies and Assessments
Early online date11 Jun 2021
Publication statusPublished - 1 Oct 2021

Bibliographical note

Funding: It is acknowledged that this project received funding from the National Natural Science Foundation of China (Project No. 51608001) and Youth Talent Program in Anhui University of Technology (Project No. DT18200013) to carry out the research work reported in this paper. The authors also acknowledge support provided by the China Scholarship Council (CSC) and research support from the Mirpur University of Science and Technology, Mirpur AJK.


  • Net zero energy building
  • Reward-penalty mechanism
  • Change rate of cost
  • Zero-energy-building level


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