Break-Even Analysis of Reactive Power Compensation in Power Grid Enterprises

Reactive power compensation improves system voltage levels, enhances grid stability margins, reduces line losses and results in economic benefits. This paper examines reactive power compensation in grid enterprises from a break-even perspective, firstly by analysing the whole life cycle costs of using power capacitors as compensation devices from three aspects, then by introducing two methods of calculating reactive power compensation to reduce line losses, and finally by conducting a break-even analysis of three different reactive power compensation schemes using a 110kV urban substation as an example, with the aim of improving the benefits of reactive power compensation in the grid. The aim is to improve the reactive power compensation efficiency of the grid and to achieve the expectation of loss reduction and power saving, and to provide a reference basis for the grid enterprises to make more economical and superior compensation performance project decisions.