Stochastic Equilibrium Models for Generation Capacity Expansion

A. Ehrenmann & Y. Smeers
Capacity expansion models in the power sector were among the first applications of operations research to the industry. We introduce stochastic equilibrium versions of these models that we believe provide a relevant context for looking at the current very risky market where the power industry invests and operates. We then look at the insertion of risk related investment practices that developed with the new environment and may not be easy to accommodate in an optimization...
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