Optimal siting of TCSC for reducing congestion cost by using shadow prices

As competition is introduced in the electricity supply industry, congestion becomes a more important issue. Congestion in a transmission network occurs due to an operating condition that causes limit violations on the transmission capacities. Congestion leads to inefficient use of the system or causes additional costs (congestion cost). One way to reduce this inefficiency or congestion cost (CC) is to control the transmission flow through the installation of thyristor controlled series capacitor (TCSC). This paper also deals with an optimal siting of the TCSC for reducing CC by using shadow prices. A performance index for an optimal siting is defined as a combination of line flow sensitivities and shadow prices. The proposed algorithm is applied to the sample system with two conditions: one is concerning the quadratic cost functions, and the other is concerning the bidding functions. Test results show that the siting of the TCSC is optimal to minimize the CC by the proposed algorithm. (C) 2002 Elsevier Science Ltd. All rights reserved.