Abstract: In order to optimize the number of emission rights purchased by an enterprise with limited rationality under the system with paid use and trading of emission rights, we study the influence of risk preference on enterprise decision-making in the context of uncertain emission right trading prices. The relationship between the purchase decision and other production decisions of an enterprise is analyzed, accordingly a purchase planning model is then given. The return risk is measured using variance and semi-variance, while the purchase decisions of enterprises with different risk preferences are further optimized by mean-variance and semi-variance models. Results show that the purchase decision of an enterprise’s emission rights is separated from other production decisions; the optimal purchase decision of an enterprise’s emission rights is affected by the market price of emission right trading, but not by the fluctuation range of market prices; and the purchase decisions of enterprises with different risk preferences are positively correlated with their risk tolerance and lower limit of expected return. In addition, compared to the optimization model that use variance to measure risk, the maximum profit and minimum risk of the optimization results by using semi-variance are both better than those obtained by the former, leading to that semi-variance is more suitable as an indicator of an enterprise to analyze the return risk in practice.

Key words: purchase decision of emission rights, uncertainty, mean-variance, semi-variance