A comprehensive tool for congestion-based nodal price modelling

An effective nodal price modeling is the key factor in managing transmission issues, which is able to generate correct economic signal. This paper examines the main idea behind the congestion-based nodal price modeling and further discusses the techniques used to incorporate transmission usage tariff into the model as a scheme of the authors´ proposed models. In this comprehensive approach pricing of transmission services is implemented together with short-term nodal pricing or locational marginal prices, which represents energy price, cost of the loss, and network congestion. Optimal power flow with shift factor methodology is utilized in the model and is compared with the dc optimal power flow method to measure the performance of the proposed scheme.