Transmission management for congested power system: A review of concepts, technical challenges and development of a new methodology

Transmission networks have some constraints that should be addressed in order to ensure sufficient control to maintain the security level of a power system while maximising market efficiency. The most obvious drawback of transmission constraints is a congestion problem that becomes an obstacle to perfect competition among the market participants since it can influence spot market pricing. As the power flow violates transmission constraints, redispatching generating units is required and this will cause the price at every node to vary. This manuscript presents concepts, technical challenges and methodology for investigating an alternative solution to the redispatch mechanism and then formulates LMP scheme using an optimisation technique that may well control congestion as the main issue. The LMP scheme are varied and improved to take into account the energy price, congestion revenue, cost of losses, as well as the transmission usage tariff by utilising shift factor-based optimal power flow (SF-OPF), which is derived from the well-known DC optimal power flow (DC-OPF) model.