A new method for allocating embedded cost of transmission under deregulated environment of power system

This paper presents a new method for allocating embedded cost of transmission to its users, through power pool and transactions under deregulated environment of power system. The proposed method allocates the embedded cost of transmission facilities among its users in a non-discriminatory manner and provides the correct economical signals in a simplest possible way. Many problems of the existing methods have been eliminated in the new proposed method. The effect of reactive power flow caused by a transaction has also been taken into consideration, while allocating embedded cost. The proposed method has been applied to South African power system and the results so obtained are found to be fair and of very much practical use