Fair Clearing of Reactive Power Market

In this paper, new reactive power market structure is studied and presented. Active power flow by itself causes active and reactive losses. Considering reactive losses of active power flow in the reactive power market without paying any costs is the main purpose of this paper. For this purpose, new methodology for reactive power market structure is proposed. Hence, this study tries to improve reactive power market and create fair competition in reactive power generation through modifying the market structure. The advantage of this method is determining the mandatory region of units based on both active power output and its distance from the load. In order to stimulate the proposed method, IEEE 24 is used, and this method is compared with each the conventional reactive power market. As it will be shown, the total payment by ISO will be reduced by using this method.