Optimal power flow solutions under variable load conditions: reactive power cost modeling

This work aims to analyze the effects of a reactive power market on the operation of a power pool. For this, it proposes a reactive power generation cost function which is based on two facts: (i) the profit of a generation company depends on the amount of active power it sells to the market, and (ii) a generator´s active power output is limited by its reactive power output. Thus, first of all, this work represents the active power generating capacity of a synchronous machine in terms of its reactive power output. Next, it associates the cost of lost opportunity to the cost of reactive power generation. This reactive cost function is introduced in a reactive optimal power flow model which is parameterized in its active and reactive loads. The solution to this problem is tracked, via a continuation method, until the maximum loadability limit. In this way, it is possible to analyze the influence of the reactive power costs on the maximum loadability limit and the market power of any generator at different load levels. Results are presented for different test systems