A bilevel programming approach to determining tax credits for biofuel production

摘要: Abstract This paper presents a bilevel programming formulation of leader–follower game that can be used to help decision makers arrive at rational policy for encouraging biofuel production. In the model, government is leader and would like minimize annual tax credits it allows petro-chemical industry producing biofuels. The crops grown this purpose are on land now set aside subsidized through different support program. agricultural sector follower. Its objective maximize profits by selecting best mix grow as well percentage aside. Two solution algorithms developed. first involves grid search over credit variables corresponding two biofuels under consideration, ester ethanol. Once these values fixed, nonfood crop prices determined farm linear program solved. second algorithm based an approximate nonlinear (NLP) An “engineering” approach taken where discontinuities in government's problem ignored model treated function maps into allocation decisions. Results given region northern part France comprising 393 farms.