Investigation of Transmission Cost Allocation Using a Power Flow Tracing Method

In the present open access restructured power system market, it is necessary to develop an appropriate pricing scheme that can provide the useful economic information to market participants, such as generation, transmission companies and customers. However, accurately estimating and allocating the transmission cost in the transmission pricing scheme is a challenging task although many methods have been proposed. The objective of this paper is to introduce a simple transmission pricing scheme using a power flow tracing method, in which transmission service cost, congestion cost and loss cost are considered. Numerical example using a test power system is presented to illustrate the effectiveness of the studied method.