An Application of Fuzzy Analytic Hierarchy Process in Risk Evaluation of Chinese Renewable Energy Overseas Investment

Renewable energy sources, including wind, solar, and biofuels, are essential for promoting sustainable economic development and mitigating environmental challenges. As China’s overseas investments in renewable energy expand, effective risk assessment and management have become critical. This study develops a comprehensive risk evaluation framework for China’s overseas renewable energy investments using the Fuzzy Analytic Hierarchy Process (FAHP). The framework incorporates political, economic, and project-specific risks, organized through three primary criteria, nine sub-criteria, and thirty tertiary indicators. By integrating expert judgments with fuzzy set theory, the FAHP methodology assigns accurate weights to risk factors and ensures consistency in evaluation. The findings identify political risks as the most significant, emphasizing their influence on investment strategies. These insights offer valuable guidance for policymakers and investors to enhance risk management strategies and ensure the sustainability of China’s renewable energy initiatives abroad.

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