This paper deals with the decentralized hierarchical PSS (Power System Stabilizer)
controller design to achieve a better damping of specific inter-area oscillations. The
two-level decentralized hierarchical structure consists of two PSS controllers. The
first level controller is a local PSS controller for each generator to damp local mode in
the area where controller is located. This controller uses only local signals as input
signals. The local signal comes from the generator at which the controller is located.
The secondary level controller is a multivariable decentralized global PSS controller
to damp inter-area modes. This controller uses selected suitable wide area PMU (Phasor
Measurement Units) signals as inputs. The PMU or global signals are taken from
network locations where the oscillations are well observable. The global controller
uses only those global input signals in which the assigned single inter-area mode is
most observable and is located at a generator that is most effective in controlling the
assigned mode. The global controller works mainly in a frequency band given by the
natural frequency of the assigned mode. The effectiveness of the resulting hierarchical
controller is demonstrated through simulation studies conducted on a test power system