An approach for evaluation of transmission costs of real power contracts in deregulated systems

Abstract

This paper presents a usage-based transmission cost allocation method based on a new set of line utility factors (LUFs), which provides power transaction impact on each element of the network in deregulated power system operation. The developed LUFs relates the line flows with generation/load for a given network configuration. In this paper, a bilateral transaction contract model through a transaction matrix and line utility factors are used to evaluate cost of bilateral power contracts. The proposed method allocates the transaction costs over the participants/contracts proportional to the ratio of power flow caused by each participant/contract and the total power flows on a designated transmission line. The method has been applied on a few sample systems, and the results for sample systems and a real life EHV equivalent system are presented for illustrative purposes