Transmission Congestion Management and Pricing In Electricity Power Markets

In trading electrical energy in deregulated power systems, violation of operation constraints such as transmission lines flow limits is possible. These conditions have been called “congestion”. One of the most important responsibility of Independent System Operator (ISO) is congestion management in a manner that all the system equipments be operated in their nominal ranges. In this paper, using topological generation distribution factor, participation of each generator in power flow in each line is calculated. Then, by means of decomposition of nodal price and mentioned factor, the effect of generation in each bus on the locational marginal price in all buses of the system are calculated. And the congestion price is calculated based on re-dispatch in constant demand. In this paper a new method is introduced to dedicate congestion price to each generator and by this method a fair congestion cost allocation is implemented. The method has been tested on IEEE 24-bus test system and the results have been demonstrated.