Reactive Power Pricing: A Combined Framework for Active and Reactive Power in Competitive Market

active and reactive power cost is proposed. Pricing reactive power separately is not very practical since its cost is highly dependent on real power output. So, reactive power should be rewritten as function of active power. The formulation of pricing mechanism is consisted of two parts: a) Traditional active power pricing and b) reactive power pricing. The methodology has been implemented using an optimal power flow program. The efficiency of proposed approach is tested on 30-bus IEEE network with piecewise linear cost functions of generators.

Keywords:

Optimal Power Flow (OPF) , Power Factor , Reactive Power Pricing , Combinational Pricing Method