Independent marginal losses with application to locational marginal price calculation

A new kind of power system marginal loss (or loss sensitivity) for nodal MW/Mvar is developed. First the electricity transmission loss is expressed in terms of source currents. It is thus an analytical function. Then the marginal loss with respect to source current is derived based on calculus and vector algebra. Using each source/load power represents its nodal injection current, the marginal loss with respect to source current is then transformed into the marginal loss with respect to source/load power. The new kind of marginal loss is based on load flow solution. It is exact in algorithm and independent of reference bus, thus called independent marginal loss (IML). The IML exactly leads to double collection of actual system loss. It makes loss components of locational marginal price small in spatial fluctuation compared to the existing marginal losses. Numerical examples including the IEEE 118-bus and PJM 5-bus systems are presented to demonstrate the calculation and effectiveness of the IML.