Bridging energy and sustainability: A game theory and fuzzy decision analytics approach to climate change management

The world has been facing a very hot-spot global problem called "climate change" due to the increased atmospheric temperature and some indicators resulting from warming due to fossil fuel consumption to supply the energy demand. Therefore, central governments and non-governmental initiatives have mandated or encouraged energy management practices. The primary objective of this research is to manage the complex decision-making process effectively, which involves multiple stakeholders, particularly governments and non-governmental initiatives, within the challenging context of climate change. The decision-making processes in energy and environmental management are inherently complex due to the involvement of heterogeneous stakeholders (governments and non-government initiatives) with potentially divergent objectives and priorities. Modeling these interdependent strategic interactions in a realistic yet tractable manner poses a significant challenge. We address this challenge by developing a hybrid decision-making framework that combines fuzzy multi-criteria decision-making (MCDM) techniques with two-player, non-zero-sum game theory. The contribution of stakeholders (government and non-governmental initiatives) on energy and environmental management was estimated for the following three criteria determined in this study: (i) increasing environmental management system (EMS) applications, (ii) promoting the circular economy (CE) concept for material and energy flows, and (iii) increasing the proportion of renewable energy (RE) resources to meet the energy demand. The strategies to be applied by both stakeholders were evaluated using fuzzy multi-criteria decision-making (MCDM) analysis according to the evaluations obtained through three experts in the environmental engineering discipline. Subsequent to the Multi-Criteria Decision-Making (MCDM) phase, the game theory methodology was employed, taking into account the Nash equilibrium concept to ascertain optimal strategies for both stakeholders engaged in the simultaneously played game. Furthermore, the sequential game version is examined by utilizing the technique of backward induction. The findings indicate that in all constructed games, government and non-governmental initiatives preferred to increase the use of RE resources or increase public awareness of the materials' life cycle assessment (LCA) or else promote the integration of EMS conception in any process. These results are intended to contribute to both energy and environmental management processes.