Locational marginal prices with SVC in Indian electricity market

Abstract

Spot pricing based on short run marginal cost (SRMC) theory has the potential to provide the economic signals for the power
system operation. Reactive power has gained importance as an ancillary service in competitive markets and its impact on nodal
price can not be ignored. With the emergence of FACTS technology, their role in the marginal price determination should be
considered taking their cost function into account. In this paper, the nodal price for real and reactive power considering different
reactive power price cost calculation methods for generator reactive power has been presented. The impact of Static Var
Compensator has also been considered taking their cost function into account. Mixed integer non-linear programming approach
has been formulated for the solution. The proposed approach has been applied for Indian 246-bus NREG system taking bilateral
transactions into consideration over and above the pool transactions.