Congestion-Management Schemes: A Comparative Analysis Under a Unified Framework

The restructuring of the electricity industry has spawned the introduction of new independent grid operators (IGOs), typically called transmission system operators (TSOs); independent system operator (ISOs); or regional transmission organizations (RTOs), in various parts of the world. An important task of an IGO is congestion management (CM) and pricing. This activity has significant economic implications on every market participant in the IGO’s region. The paper briefly reviews the CM schemes and the associated pricing mechanism used by the IGOs in five representative schemes. These were selected to illustrate the various CM approaches in use: England and Wales, Norway, Sweden, PJM, and California. We develop a unified framework for the mathematical representation of the market dispatch and redispatch problems that the IGO must solve in CM in these various jurisdictions. We use this unified framework to develop meaningful metrics to compare the various CM approaches so as to assess their efficiency and the effectiveness of the market signals provided to the market participants. We compare, using a small test system, side by side, the performance of these schemes.