Medium-term modeling of electricity market has essential role in generation expansion planning. On the other hand, uncertainties strongly affect modeling and consequently, strategic analysis of generation firms in the medium term. Therefore, models considering these uncertainties are highly required. Among uncertain variables considered in the medium term generation planning, demand and hyd...

We analyze a simple system of conservation laws with a strong relaxation term. Well-posedness of the Cauchy problem, in the framework of BV-solutions, is proved. Furthermore, we prove that the solutions converge towards the solution of an equilibrium model as the relaxation time > 0 tends to zero. Finally, we show that the dierence between an equilibrium solution (= 0) and a non-equilibrium sol...

This note examines equilibrium existence of Nash-Bertrand pricing games with discrete-choice models of demand. We provide a sufficient and necessary condition on the distribution of firm idiosyncratic shocks for best response correspondences to exhibit monotonicity. We then use Tarski’s fixed point result to show that the condition we provide generates a unique pure-strategy equilibrium. Moreov...

In this article, we develop a two-factor model of commodity prices that allows meanreversion in short-term prices and uncertainty in the equilibrium level to which prices revert. Although these two factors are not directly observable, they may be estimated from spot and futures prices. Intuitively, movements in prices for long-maturity futures contracts provide information about the equilibrium...