In this paper, complete preemption game model based on the real option theory is provided to analyze the optimal investment timing for investors when they compete with counterparts for the renewable energy projects under the feed in tariff policies. A geometric Brownian motion is adopted to characterize the dynamic variation of electricity spot pricing. Also, the influence of incomplete information related to rivals' investment timings on the decisions is stuaied. Theoretically, it is proved that the investment timing is within the range with upper bound of the timing for a monopolist and lower bound of the timing decided by zero-net present value. Numerical results reveal that the more FIT level and the earlier investment timing. The proposed model is able to help investors to determine the optimal timing of the feed in tariff policies when they participate in investigating, and the policy makers can draft a reasonable FIT level according to the feedback of the investors.
LI Li, ZHU Lei, FAN Ying
. Competitive Investment Strategy for Renewable Power Generation Under Uncertainty[J]. Chinese Journal of Management Science, 2017
, 25(7)
: 11
-17
.
DOI: 10.16381/j.cnki.issn1003-207x.2017.07.002
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