Computation of Locational Marginal Price in power market in different load and system conditions

Abstract

This paper presents the variation of Locational Marginal Price (LMP) with change in the load and system conditions. In deregulated power system, congestion in the transmission line is a major issue. The LMP calculation is the key factor to identify and manage congestion. It helps the power market participants to observe the actual cost of energy at every bus and improve their visibility to identify highly congested locations. Thus participants can strategically bid for energy price at every bus for the next schedule in order to maximize their profit. The linear programming optimal power flow (LPOPF) is used to evaluate Locational Marginal Price. In this paper LMP is calculated for PJM 5 bus system in light load as well as in peak load period with and without considering the transmission constraints in the system.