Network loss modification for bidding prices is based on the result of flow calculation, reflecting the transmission cost change. Meanwhile, it is an important indicator of the market fairness. Based on power distribution theory and cost flow conservation, this paper studies the relationship between the loss and transmission cost. It shows that although the network loss remains unchanged, the transmission cost will change when a component uses two different equivalent models. The phenomenon illuminates the fact that the flow calculation of transmission may be different because of the different models. Taking the IEEE 9 bus system for example, the transmission cost is carefully calculated by using the traditional transformer model or the equivalent circuit model of typeâ…¡. The study shows that the cost of transmission is smaller when the equivalent circuit model is chosen. Therefore, it is scientific to choose the equivalent circuit model in flow calculation. The result is conducive to achieve fairness in the flow calculation of network loss modification.
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