Abstract :
In this paper a bilevel framework is formulated for describing the interdependent decision making process of an authority responsible for the long-term energy planning and a multitude of investors in wind energy projects. The former seeks to design the incentives for wind producers that will result in an optimal energy mix, comprising wind parks and conventional generation units. The latter decide upon the size of the wind energy project based on the net present value (NPV), a commonly used indicator for testing investment viability. The proposed framework facilitates the process of determining the optimal levels of guaranteed prices for energy injection from renewable energy sources leading to a total installed capacity that achieves both maximal NPV for the investor as well as minimum total energy cost for serving the predicted energy demand.
