Plenary Lecture
A Robust Optimization Approach to Solar Power Installation Capacity under Feed-in Tariff Policy: A Case in Taiwan
Professor Hsiao-Fan Wang
Department of Industrial Engineering and Engineering Management
National Tsing Hua University
Taiwan
E-mail: hfwang@ie.nthu.edu.tw
Abstract: Solar power is a potential renewable energy to develop because of its sustainability. From environmental and economic aspects, the government has conducted a policy to subsidize the individuals on installing the solar photovoltaic system from both financial assistance and buy-back assurance such as Feed-in Tariff scheme. It is an incentive to people to have economic-benefits to make profits and environment-benefits to reduce carbon emissions in the investment. Due to the possible risk embedded in this long-term investment, the purpose of this research is to help the investors to evaluate and analyze the expected return and potential risk. In order to achieve the economic and environmental benefits, an analytical model is proposed to determine the optimal installed capacity under the given guaranteed price for specific time period. Sensitivity analysis are conducted on parameters, including installation cost, maintenance cost, electricity generation and discount rate such that the critical factor to affect the profitability can be identified. Based on this factor, a robust optimization model has been developed from the original deterministic model for evaluating potential risk and uncertainty such that a robust investment will be provided. The robust model has been applied to an enterprise of Taiwan. The risk preferences of decision maker are also considered. The results have shown that the model is able to suggest a robust installed capacity toward the risk preference of decision maker. Through the evaluation of the investment with the performance measures including expected net present value, payback period and internal rate of return, a robust installed capacity has been determined to maximize net benefit.
Brief Biography of the Speaker: Hsiao-Fan Wang is the Distinguished Chair Professor of National Tsing Hua University (NTHU), Taiwan, Republic of China; Fellow of Chinese Institute of Industrial Engineering and Erskine Fellow of Canterbury University, NZ. She is also taking charge of both the Research Center of Advanced Manufacture & Service Management; and the Arts Center of the university. She has been teaching at the Department of Industrial Engineering and Engineering Management at the same university, NTHU after she graduated from Cambridge University, UK in 1981. She used to be the Vice Dean of the College of Engineering, the Head of the Department of IEEM, in NTHU, President of Chinese Fuzzy Systems Association, Vice President of International Fuzzy Systems Association. Also, she has been awarded the Distinguished Research Award from National Science Council of Taiwan, ROC; Distinguished Contracted Research Fellow of NSC and Distinguished Teaching Award of Engineering College, NTHU. She is the area editors of several international journals and has published more than 120 journal papers; as well as is the (co)author of 15 books. Her research interests are in Multicriteria Decision Making, Fuzzy Set Theory and Green Value Chain Management.