1. Nash Equilibrium in Strategic Bidding: A Binary Expansion Approach.
- Author
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Barroso, Luiz Augusto, Carneiro, Rafael Dix, Granville, Sérgio, Pereira, Mario V., and Fampa, Marcia H. C.
- Subjects
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ELECTRIC utilities , *LETTING of contracts , *INDEPENDENT power transmission companies , *ELECTRIC power distribution , *ELECTRIC industries , *ASSOCIATION schemes (Combinatorics) , *LINEAR programming - Abstract
This paper presents a mixed integer linear programming solution approach for the equilibrium problem with equi- librium constraints (EPEC) problem of finding the Nash equilibrium (NE) in strategic bidding in short-term electricity markets. A binary expansion (BE) scheme is used to transform the nonlinear, nonconvex, NE problem into a mixed integer linear problem (MILP), which can be solved by commercially available computational systems. The BE scheme can be applicable to Cournot, Bertrand, or joint price/quantity bidding models. The approach is illustrated in case studies with configurations derived from the 95-CW Brazilian system, including unit-commitment decisions to the price-maker agents. [ABSTRACT FROM AUTHOR]
- Published
- 2006
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