OPTIMAL PRICING OF TRANSMISSION SERVICES - APPLICATION TO LARGE POWER-SYSTEMS

The paper describes the application of a previously reported [4] optim al transmission pricing method to a large power system. The transmissi on prices are determined by a global benefit optimisation algorithm th at allocates both capacity and operational costs on a time-of-use basi s. It is shown that optimal prices may be derived using a conventional mathematical programming algorithm and results are presented in relat ion to the IEEE 24 bus test network. A particular feature of the prese nt method is the inclusion of both system security and energy transpor tation costs. This is achieved by a specialised technique for iteratin g between benefit maximisation and a system security assessment. Resul ts presented illustrate time-of-use transmission tariffs, together wit h the variation of capacity costs with system security standards.