The basic assumptions in TIMES and many other partial equilibrium models is competitive markets and perfect information. You can however introduce market imperfections by introducing user-defined explicit constraints, such as limits to technological penetration, constraints on emissions, exogenous oil price, etc., or in the form of taxes, subsidies and hurdle rates.
As far as I can see, a 15% royalty of the annual generation given to the government does not seem to fit too well with the ways TIMES can handle market imperfections. If I understand correctly, it means that 15% of the revenues are transferred from the investor/owner to the government. If we consider the situation where hydro power would be marginally competitive, I guess that royalty condition might be reasonably well simulated by introducing a tax of 1/(1-0.15)= 17.6% on top of all costs of new hydro plants (NCAP_ITAX for investment, NCAP_FTAX for fixed O&M, FLO_TAX for variable cost). The tax burden would simulate the burden of the 15% revenue loss.
At the moment I don't have any other ideas.
As far as I can see, a 15% royalty of the annual generation given to the government does not seem to fit too well with the ways TIMES can handle market imperfections. If I understand correctly, it means that 15% of the revenues are transferred from the investor/owner to the government. If we consider the situation where hydro power would be marginally competitive, I guess that royalty condition might be reasonably well simulated by introducing a tax of 1/(1-0.15)= 17.6% on top of all costs of new hydro plants (NCAP_ITAX for investment, NCAP_FTAX for fixed O&M, FLO_TAX for variable cost). The tax burden would simulate the burden of the 15% revenue loss.
At the moment I don't have any other ideas.