Basic theoretical foundations and insights on bilevel models and their applications to power systems

David Pozo, Enzo Sauma, Javier Contreras

Research output: Contribution to journalArticlepeer-review

51 Citations (Scopus)

Abstract

Decision making in the operation and planning of power systems is, in general, economically driven, especially in deregulated markets. To better understand the participants’ behavior in power markets, it is necessary to include concepts of microeconomics and operations research in the analysis of power systems. Particularly, game theory equilibrium models have played an important role in shaping participants’ behavior and their interactions. In recent years, bilevel games and their applications to power systems have received growing attention. Bilevel optimization models, Mathematical Program with Equilibrium Constraints and Equilibrium Problem with Equilibrium Constraints are examples of bilevel games. This paper provides an overview of the full range of formulations of non-cooperative bilevel games. Our aim is to present, in an unified manner, the theoretical foundations, classification and main techniques for solving bilevel games and their applications to power systems.

Original languageEnglish
Pages (from-to)303-334
Number of pages32
JournalAnnals of Operations Research
Volume254
Issue number1-2
DOIs
Publication statusPublished - 1 Jul 2017
Externally publishedYes

Keywords

  • Bilevel games
  • Equilibrium Problem with Equilibrium Constraints
  • Game theory
  • Mathematical Program with Equilibrium Constraints
  • Operation research in energy

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