Research On Transmission Pricing Based On Long-run Incremental Cost Method

With the development of social economy, the vertical monopoly integrated operationmodel in power industry has become increasingly outdated. During the past decades, manycountries carried out market-oriented reforms in power structure, whose important content isto split the monopoly structure and to separate transmission from generation and electricitysale, and under government regulations independent operator is set up to be responsible forthe secure and stable operation of power systems. Hence transmission pricing is a keyresearch subject. The core problem of transmission pricing is how to fairly and reasonablyallocate the cost of transmission network to all users, which will provide good economicincentive information to the various participants within the electricity market, improve themanagement efficiency of the power grid company, guide power plants and load to berationally distributed, and ultimately promote the orderly development of power system.This thesis first introduces the basic theory of transmission services and transmissionpricing under the research background of electricity market reform, and reviews severalcommonly used power flow composition analytic methods involved in transmission pricing.The mathematical model is established on long-run incremental cost pricing method intransmission networks considering the dynamic security factor. The actual seven-node systemand the IEEE-14system are implemented to verify the results that the costs of transmissionnetwork incurred by new users will be more realistic reflected and allocation of powerinvestment costs will be more reasonable with this method.Finally, the relation of power flow composition analytic methods and transmissionpricing is discussed, and electric distance method and the proportional share method areadpoted in the actual seven-node system and the IEEE-14system to verify the conclusion thatthere are significant impact on transmission pricing.