Integrating multi-criteria decision making and game theory approaches to identify sustainable power supply solutions grounded in economic optimization: A case study in the abundant climates of Iran

Focusing solely on economic objectives in the optimization of hybrid renewable energy systems has led to challenges in achieving acceptable performance across other sustainable development goals, including technical, environmental, energy security, and social criteria. To address these challenges, the criteria importance through intercriteria correlation (CRITIC) and Shannon entropy objective weighting methods, along with the Best-Worst Method (BWM) for subjective weighting, are embedded in the Nash Bargaining Solution (NBS) to provide reliable criterion weights for the multi-criteria decision-making (MCDM) process. This integration between game theory and MCDM aims to enhance sustainability indicators in the optimal power supply configuration while achieving a balanced trade-off between subjective and objective decision-making approaches. The cost of energy (COE), capacity factor, carbon emissions, and excess electricity level are identified as the most important criteria for selecting the optimal power supply configuration, with importance weights of 11.2 %, 9.6 %, 9.1 %, and 8.6 %, respectively. In addition, most of the abundant climates in Iran (classified according to the Köppen standard) are identified as the most sustainable for supplying stand-alone mid-rise apartments, whereas the hot-dry desert climate shows lower potential for sustainable energy systems. The optimal configurations present COE values ranging from 0.138 to 0.153 $/kWh, while meeting approximately half of the demand through solar and wind resources. Furthermore, the policy of converting surplus renewable energy into green hydrogen using electrolyzers results in the production of 150–600 kg H2 /year, while maintaining the final level of excess power below 5 %. • The game theory-based criteria weighting is integrated with multi-criteria decision making. • 15 criteria across techno-economic, environmental, energy security, and social aspects are used. • Nash Bargaining Solution combines objective and subjective criteria weighting in power system. • The most sustainable system achieves an energy cost of 0.138 $/kWh in a dry desert climate. • Green hydrogen production reduces renewable excess power from 14 % to below 5 %.