The optimization and cost recovery of the reactive power in power market

Abstract

This paper analyzed the unbundling of the spot price, and discusses the theory of the spot price based on the LP decoupled model, which set the bases to the following discussion. Because the spot price is fluctuant and the merchandise surplus exists, the complexity of the participation of the third part and the system operation is greatly increased. It becomes important to express the reactive cost if the reactive power electricity market is built. The paper provides the method to get the corresponding operation cost based on the analysis of SVC capacity available factor in assigned years, which can cover the investment cost completely.