Locational balance service auction market for transmission congestion management

A novel market design is proposed and developed that uses the energy-balance services for transmission-congestion relief. In this proposed market, all generators and customers have the ability to submit their offers to increase/decrease their generation/consumption, respectively. Each participant provides a ‘price–quantity’ offer to the independent system operator (ISO) which is independent of the energy market and is activated after the energy market is settled. The ISO arrives at the optimal procurement of the balancing services for congestion management based on the ‘importance’ of each market participant to transmission congestion relief using the concept of ‘line specific’ generalised generation-distribution factors. List of symbols and abbreviations i, j, k index for buses a0, b0, a, b, c scalar multipliers BSAM balance service auction market CR congestion redispatch EM energy market FTR financial transmission right GGDF generalised generation distribution factors ISO independent system operator LMP locational marginal price, $/MWh LSF load scaling factor MD market dispatch NG total number of generator buses NL total number of load buses NT total number of transmission lines OPF optimal power flow PD real power demand, p.u. PG real power generation, p.u. PG real power generation after market settlement, p.u. P G upper limit on real power generation, p.u. P G lower limit on real power generation, p.u. Pij power flow on line i-j, p.u. Pmax ij maximum transfer capacity of line i-j, p.u. QD reactive power demand, p.u. QG reactive power generation, p.u. QC reactive power compensation, p.u. Q C upper limit on reactive-power compensation, p.u. Q C lower limit on reactive-power compensation, p.u. TCS total cost of service, $ V bus voltage, p.u. V max upper limit on bus voltage, p.u. V min lower limit on bus voltage, p.u. Yij element of network admittance matrix, p.u. y angle associated with Yij, rad d voltage angle, rad Pinj,k injected power at bus k, p.u. Dij,k generalised generation-distribution factors PG up-regulation of generation, p.u. P G down-regulation of generation, p.u PD up-regulation of load, p.u. P D down-regulation of load, p.u. CG up-regulation offer price from a generator, $/MWh C G down-regulation offer price from a generator, $/MWh Cd up-regulation offer price from a load, $/MWh C d down-regulation offer price from a load, $/MWh rPG up-regulation market price for generators, $/MWh r PG down-regulation market price for generators, $/MWh rPD up-regulation market price for loads, $/MWh r PD down-regulation market price for loads, $/MWh