Coordination of the hierarchical voltage control with the reactive power economic compensation

Voltage control and reactive power management are usually studied and applied mainly by the technical point of view. System operators and planners have developed complex control schemes, in order to achieve a secure and efficient operation. However, the deregulation of the electric systems requires the definition of market procedures ensuring an effective management of reactive resources on which the voltage regulation relies. If the economic issues related to the transmission network (and to the system control) have to be managed separately from the generation, the definition of payments for participating to the voltage regulation becomes a difficult task, bound by conflicting objectives, from both the technical and the economic viewpoints. Such objectives are: maintaining an adequate security level, defining correct economic signals for power plants equipment, providing a simple and transparent structure, ensuring market equity, and, last but not least, avoiding burdening on the final energy price. Whereas in a vertically integrated utility it should be sufficient to analyse the global behaviour of the system (transmission plus generation), within a competitive framework it is crucial to determine and meter the performance of each generator. After a brief review of the main procedures of reactive pricing available in literature, a simple scheme, aimed at enhancing the reactive resources management in the Italian market, is proposed, based on the economic quantification of the actual charges related to the voltage regulation.