Analysis of multiple solutions in the calculus of firm energy

This paper uses a linear optimization model to investigate the calculus of firm energy rights of hydro power plants in Brazil. The firm energy values influence directly in the remuneration of the Brazilian hydro plants, besides that, linear optimization models are widely used in the literature for studies of firm energy. In this work, the authors show that the linear optimization models used in the calculus of firm energy rights can present multiple optimal solutions, more specifically, that it is possible to solve the problem to optimality and find different individual firm energy values, this behavior is not desirable in the firm energy models since this parameter impacts directly in the remuneration of the hydro plants. Using data from the Brazilian Electrical System the authors could determine the intensity of these multiple optimal solutions in an example, the results show that the phenomenon is relevant, influencing significantly in the firm energy values.