The research work described in this thesis concentrates on the application and feasibility of FACTS controllers as a solution to the problem of congestion management. Effective congestion management has become increasingly important since wholesale electricity markets became privatised and competition was encouraged between generation and load (supply) companies. In addition, growth in load demand, planning permission and the need to integrate renewable generation sources will push transmission systems to work closer to their operating limits. Therefore, ensuring future systems are able to sustain these new conditions is a considerable challenge.\ud The first part of the work focuses on the integration of the bilateral market and steady state FACTS controller models into the interior point optimal power flow (lP OPF) algorithm. The objective is to minimise changes to scheduled bilateral market contracts to provide economic savings for the transmission system operator (TSO) within congested systems. The optimisation technique is able to reduce the level of congestion. Early results identify that congestion is the dominant proportion of the system costs incurred while system losses are of similar levels with and without controller installation. A functional procedure is proposed for fair and easy comparison and a general two-step method is introduced which aims to find optimal location and rating of the installed controller by applying the IP OPF algorithm.\ud In the latter part, the general two-step method is utilised to assess the performance of FACTS controllers in terms of financial benefits over an average year, and considers daily and seasonal changes in demand.I n practice, transmission systems contain thousands of buses therefore a sensitivity-based three-step method is developed to reduce the number of required simulations to find the optimal location and rating of FACIS controllers. The method has been successfully demonstrated on IEEE standard test systems and has the potential to act as a first-step screening technique for practical systems. The last section of this work is concerned with assessing the economic feasibility of FACTS controllers as a congestion management solution by introducing an economic measure - a return index. This measure is used to assess the viability of different locations as it compares the relative cost savings of the TSO to the equipment cost of the controller. In conclusion, the results show that with appropriate location choice, installation of specified FACTS controllers are able to provide a solution to the congestion management problem with realistic Payback periods
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