Performance indices to measure and compare system utilization and congestion severity of different dispatch scenarios

In competitive electricity markets, energy Locational Marginal Prices (LMPs) are commonly used to allocate energy payments and transmission congestion charges and credits. In these markets, energy prices and transmission pricing are highly affected by transmission constraints, where a congested transmission is accompanied by congestion costs, lower system utilization, and higher energy prices due to resorting to out-of-merit order as expensive generating units are dispatched to alleviate congestion. The paper presents some performance indices to compare different dispatch options, where it proposes to use some congestion and system utilization measures. These measures are used in the paper to indicate level of system usage and congestion severity under different dispatch scenarios, and may enable the system operator or the qualified dispatch decision-making entity to decide which dispatch, among different dispatch scenarios, is the optimal. To show an example of using presented measures, planned line switching has been used to minimize transmission congestion cost and increase system utilization. The model used for energy market in the paper involves both spot (pool) transactions and firm bilateral contracts. The presented method is applied to a three-bus and an eight-bus test systems, where the results show that considering opening of some transmission lines may improve outcome of social-welfare problem, as reflected in reducing total congestion cost and improving system utilization.