| Title |
A New Approach to Calculation of the Components of Locational Marginal Price |
| Authors |
이기송(Lee Ki-Song) ; 정윤원(Jeong Yun-Won) ; 신중린(Shin Joong-Rin) ; 김진호(Kim Jin-Ho) ; 박종배(Park Jong-Bae) |
| Keywords |
Locational Marginal Price ; Shadow Price ; Components of Locational Marginal Price ; Marginal Loss Factor |
| Abstract |
This paper presents a new methodology to draw the components of locational marginal price (LMP) in electricity market. Recently, the changing environments surrounding electricity industries resulted in the unbundled services provided by electricity market players, which may require the new pricing mechanisms based on the LMP. The changed pricing mechanisms will provide the price signals of time and location to the market participants. Most of the existing studies of LMP are based on the Lagrangian multipliers as shadow prices to evaluate the equivalent values of constraints or factors for security, reliability and quality. However, the shadow prices cannot provide enough information for components of LMP. In this paper, therefore, we proposed a new approach that LMP is divided into three components. To do this, we first present the method for shadow prices calculation and then break down LMP into a variety of parts corresponding to the concerned factors. The proposed approach is applied to 5-bus and modified IEEE 14-bus sample system in order to verify its validity. |