Cost of transmission transactions: an introduction

The authors discuss technical issues related to the cost of transmission transactions provided by a vertically integrated utility company. Recognizing the complexities involved, the authors emphasize clarity over exhaustiveness. The authors use engineering terms throughout, but mention the more common economic terms also used in this context. The main goal is to provide basic guidelines for identifying and evaluating the cost of transmission transactions. The authors identify the components of the cost of a transmission transaction and present methodologies for evaluating them using simple examples