Market oriented reactive power expansion planning using locational marginal price

In this paper a new method for market oriented reactive power expansion planning is presented. Primary candidates are proposed by ISO and investors determine the optimal candidate by computing annual expansion profit of each candidate. Market oriented reactive power expansion planning causes an increase in the capacity of reactive power production of producers who have appropriate location in the network and/or submit suitable bids for reactive power production. Increase in capacity of these producers will lead to decrease in losses and systempsilas operational cost.