Transmission Pricing Practices: A Case Study

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1 Transmsson Prcng Practces: A Case Study N.K.Garg D.K.Palwala Harsh Sharma Electrcal Engneerng Electrcal Engneerng Computer Engneerng Govt. Engg. College Rajasthan Techncal Unversty Rajasthan Techncal Unversty Jhalawar, Inda Kota, Inda Kota, Inda n_garg@yahoo.com dheerajpalwala@gmal.com harsh.sharma007@gmal.com Abstract (Ths paper presents a case study on transmsson prcng practces. Now a days, restructurng of the power system maret through deregulaton s ganng attenton as techncal and economcal benefts at generator and user. In Inda, after the Electrcty Act 2003, restructurng has been ntroduced n the Indan power system maret. Researchers are contnuously worng towards mprovement of deregulaton based on restructurng to mprove transmsson prcng practces and calculatons n a better way. Therefore, ths paper presents an overvew of MW- Mle and postage stamp methods to estmate the transmsson cost. Further, the North Indan practcal power system of 37 bus test system has been analyzed by reverse, absolute and domnant Mw-Mle methods. The results obtaned to be expected for deregulated power maret.) Index Terms Deregulaton, MW-Mle method, Open access, Restructurng, Transmsson Prcng I. INTRODUCTION Restructurng of power sector usng the method of deregulaton has been a een pont of nterest for the power system researchers. Deregulaton unbundles the electrcty busness nto three components: generaton, transmsson and dstrbuton. Deregulated electrcal utltes provde hgher operatng effcency, lower energy cost and compettve maret. Restructurng of the transmsson system wth exstng networs has always been a herculean tas for power ndustry people, due to complexty n establshment of the rules for operatng transmsson system and prcng transmsson servce n deregulated system [].The prcng structure should be so as to recover cost of transmsson networ, ensure unnterrupted operaton, provde nvestors wth good return and provde the same opportunty to all users [2]. Transmsson open access refers to a regulatory reform whch addresses the oblgaton, rght, operatng procedure and economcal condton; thus enablng two or more partes to access the transmsson facltes (grd) owned by thrd party (partally or fully) for transmsson of electrcal power. Countres round the globe, have contnuously been mang efforts to acheve redefned generator and use frendly transmsson system. The open access transmsson concept does not have a unform model and need to be revewed and mplemented dependng upon specfc crcumstances of dfferent natons. Bascally four types of embedded cost methodologes of wheelng cost are used for transmsson system vz. Postage stamp, Contract path, MW-Mle and MVA-Mle method. These methods have been tested for allocatng the transmsson cost to wheelng transactons on standard and practcal test system of dfferent natons. Meah et al. [3] dscussed MW-Mle method usng Malaysan power system n order to assess ther mpact on the long term transmsson plannng. Flow based method and the effect of reactve power n embedded cost has been dscussed on South Afrcan power test system [4 ].Par et al. [5] explaned a varaton of the power flow based MW-Mle methods on standard 5 and 4 bus test system. Ferrera et al. [6] dscussed the postage stamp, MW-Mle and some of ts varants usng a smple 9-bus electrcal networ. Meterng and dfferentatng between dfferent categores of energy sales, durng the wheelng transactons, have been presented on West Afrcan nterconnected system [7].Slva et al. [8] explaned MW-Mle the modulus and the zero counter flow methods usng the Protuges

2 transmsson company networ to set tarff. Delshad et al. [9] dscussed transmsson prcng of Iran electrcty maret. In Inda, wth the enactment of the Electrcty Act 2003 [0] [] and mplementaton of open access, the old sngle buyer structure maret of power sector has been changed to a mult-buyer model. The maret structure, taen shape after the Act 2003, has proved promsng as t provded the rght of choce to the suppler as well as buyer; thus ensurng the qualty and relablty of power and competton n the maret. The exstng transmsson prcng practce n Inda s postage stamp whch has dscouraged power maret [2], as t doesn t consders the crcut loadng. Roselne et al. [3] dscussed a case study of Taml Nadu, Inda and explaned dfferent components such as power generaton, man power ratonalzaton, renewable energy, and transmsson and dstrbuton losses. Warad et al. [4] appled MW-Mle and MVA-Mle methods to Maharashtra State Electrcty Transmsson Company Lmted (MSETCL) networ and wored out optmal cost of tarff for MSETCL system. The effect of reactve power flow caused by the wheelng transacton has been explaned usng the IEEE-30 bus and Indan utlty-62 bus systems. Kumar et al. [5] dscussed MW-Mle and MVA-Mle approaches n Indan power system and explaned the cost effectveness of each crcut for varous users of the crcut. Researchers have contnuously been worng n the feld of transmsson prcng across the world to determne best optmal method. Ths paper presents transmsson cost allocaton to power purchasers at multple transactons and explans the benefts of these transactons on test system. MW-Mle and Postage Stamp methods on Indan utlty -37 bus system. II. INDIAN POWER SECTOR AND MARKET Indan power sector has changed sgnfcantly after enactment of Electrcty Laws le Amendments Acts 998 and Electrcty Act These amendments made Central Transmsson Utlty (CTU) and State Transmsson Utlty (STU) responsble for mantanng generaton schedule, revewng project progress, plannng ntegrated operaton among the utltes, coordnatng the mantenance schedule, determnng the avalablty of power for nterstate utltes transfer and decdng a sutable tarff for the nter-utlty exchange of power. Presently Indan power system s beng operated on a regonal bass whch s dvded nto fve regonal grds,.e. Northern Regon (NR), Western Regon (WR), Southern Regon (SR), Eastern Regon (ER) and North Eastern Regon (NER). NR, WR, ER and NER regons are beng operated n synchronous mode whle SR grd s connected n asynchronous ln as shown n Fg. [6]. Fg. Indan Regonal Grds Each regon has a Regonal Load Dspatch Center (RLDC), whch s under the operaton control of CTU. RLDC manages the ntegrated operaton of the connected regon and ensure the grd operaton [7]. Every state has a State Load Dspatch Center (SLDC) whch s top body of state. SLDC has the responsblty to ensure ntegrated operaton of the power system n the state. SLDC has also the responsblty to allocate the total avalable power to varous states through RLDC. The regon wse power supply poston n the country durng the year has been gven Table I [8]. It shows that both the energy and pea demand requrement have the defct. Hence Indan power sector has the challenge to narrow down the gap between demand and supply usng exstng transmsson networ. 2

3 Transferrng power from one place to another pont s dependent upon the load and generaton of the system; hence transmsson cost allocaton has sgnfcance. Central Electrcty Regulatory Commsson (CERC) has mproved the effcency and competton for real tme balancng networ by allowng Open access, nter-regonal electrcty transmsson and Avalablty Based Tarff (ABT) [9]. CERC has also setup Indan Energy Exchange (IEX) for provdng power tradng. IEX manages and provdes day-ahead contracts, prce dscovery and prce rs management to the generators, traders, dstrbutors, staeholders and consumers [20]. Day-ahead contracts tmelne management has been n quo wth the RLDC. Indan power system s one of the largest growng sectors and hence need to be reformed for optmal utlzaton of the large and complex transmsson networ. In ths quest, Transmsson open access s a ey thought and contnuous efforts are beng made to attan best sutable transmsson prcng system. TABLE I ENERGY AND PEAK SHORTAGE Regon Requrement (MU) Energy Avalabl ty (MU) Defct (MU) Deman d (MW) Pea Met (MW) Defct (MW) NR WR SR ER NER Inda III. PROBLEM FORMULATION Problem s formulated for allocaton of transmsson cost to customers at multple transactons. The magntude of feasble wheelng transactons has been estmated as t does not volate the transmsson constrants. In ths case, transactons made by power purchasers should be utlzed optmally n order to derve maxmum benefts. Mnmum wheelng charge of the transactons has also been computed n the test system to utlze the buses as ndustral promoton and assure consumer benefts. Ths analyss has been performed by MW-Mle and Postage stamp technques. Before the allocaton of transmsson cost, load flow soluton for the networ s obtaned under steady state condton subjected to certan nequalty constrants under whch the system s operated and bus voltages, reactve power generatons, load magntude varables are used as the constrants. As the bus voltages and phase angles are determned by load flow soluton. Therefore power flow through nterconnectng transmsson lnes and the power njecton at all the buses could be estmated easly. Here, the load flow equatons are evaluated by Newton Raphson method as ts convergence rate s hgher. Consder that there s total N number of buses n a power system networ. The nodal actve power P and reactve power Q of each transacton of seller and purchaser at bus satsfes the followng equatons and constrants [2]. n P P P V V Y cos,, 2,3...N G D j j j j j n G D j j j j j () Q Q Q V V Y sn,, 2,3...N (2) Where PG: Actve power of Generator, QG: Reactve power of Generator, PD: Actve demand of Load, QD: Reactve demand of Load, V: Bus Voltage, Y: Bus Admttance Matrx, δ: Angle of Bus Voltage and θ: Angle of Bus Admttance Matrx (a) Constrants of real and reactve power generaton PGmn PG PGmax (3) QGmn QG QGmax (4) (b) Lmts of bus voltage magntude and ts angle V V V mn max (5) mn max (6) Intally Power flow solutons are obtaned wthout any transacton, called base value, and the solutons are calculated for multple transactons by checng the lmts of the varables. Thus transmsson cost s computed usng MW- Mle method as shown hereunder n flow chart (Fg. 2). 3

4 Fg.2 Flow Chart for MW-Mle Method IV. MW-MILE METHOD Ths method deals wth change n the magntude of power flow for the system by wheelng transacton n order to allocate the wheelng costs of each wheelng transacton [22] [23]. One of the dstnct features of ths method ncludes the determnaton of wheelng cost for the length of transmsson lnes used n the transacton. Ths attempt helps n solvng the flaws n the rolled-n-embedded method, where the dstance between the pont of supply and the pont of the recpent has no effect n determnng the usage of the transmsson system by the wheelng transacton. Ths method s also nown as Lne-by-Lne method and the cost s calculated by the equaton (7) (7) Where L s length of crcut, F s predetermned unt cost reflectng the cost/mle of crcut, N s total number of crcuts n the crcut, P s power flow mposed on the crcut by user, P s capacty ratng of crcut. There are three dfferent approaches, used n MW-Mle method consderng the drecton of power flows [5], [24]. A. Reverse MW-Mle Approach Ths approach calculates the charge for each lne based on power flows. It consders the postve and negatve power flows. Power flow mposed on the crcut by the user, P s treated based on the followng condton, P +ve for drect power flows, or -ve for reverse power flows B. Absolute MW-Mle Approach In ths approach, charge s calculated by the absolute value of the power flow whether t s postve or negatve power flow.power flow mposed on the crcut by the user, P s consdered based on the followng condton, C K P P for drect and reverse power flows C. Domnant MW-Mle Approach In the domnant MW-Mle approach, networ users are only charged on the bass of drect power flow mpose on each lne and power flow mposed on the crcut by the user, P s calculated based on the followng condton, N K L.F.P P P P for drect power flows,or 0 for reverse power flows Total cost of transmsson s calculated usng the postage stamp method [3]. Ths method allocates the wheelng charges based on the magntude of the wheeled or transacted power. It assumes the whole transmsson system s nvolved n wheelng transacton. Ths approach s appled to each bus and resdual cost wll be apponted to each user based on ts load level usng the equaton. PLK RK TC. P LT (8) The total cost allocated to each ndvdual user, TC s calculated by the equaton TC CK RK (9) 4

5 V. RESULT ANALYSIS AND DISCUSSION KTPS 2 6 G G 2 LEGEND: 220 KV Lne/Bus 32 KV Lne/Bus 220/32 KV ICT Thermal Generaton Rajasthan state s one among few states to begn power sector reforms n Inda. Rajasthan State Electrcty Board (RSEB) has now been unbundled as one Generaton, one Transmsson and three Dstrbuton companes. Rajasthan Rajya Vdyut Utpadan Ngam Ltd. (RVUNL) Company has nstalled capacty of MW. RVUNL s also managng and operatng nterstates operaton projects of 27 MW. Pea demand of the state s 8940 MW and EHV lnes of around Cm. Open access s beng allowed n phased mode of MVA and above, from Aprl The study has been conducted on Indan utlty -37 bus system of Rajasthan state. The one lne dagram s shown n Fgure 3.The names of the buses are gven n Appendx AI. It conssts of 37 buses, 2 generators and 49 Fg Bus Test Networ transmsson lnes at 220 V and 32 V voltage level. Tarff ($-Mllon/MW/Year) MW 50 MW 75 MW 95 MW Fg.4. Tarff for Reverse Approach 5

6 Tarff ($-Mllon/MW/Year) Tarff ($-Mllon/MW/Year) Voltage(PU) 25 MW 50 MW 75 MW 95 MW Fg. 5. Tarff for Domnant Approach MW 50 MW 75 MW 95 MW Fg.6. Tarff for Absolute Approach Base Value Fg.7 Voltage Varaton The generaton capacty 300 MW s assumed as base load condton and total load connected on the system s 9 MW. The smulaton studes are carred out on Intel core GHz system n MATLAB envronment. It s assumed n ths analyss load customer would pay 00% of the transmsson cost of servces to the transmsson utlty. The annual revenue requrement of transmsson faclty s $-Mllon. The MW-Mle method s appled to Indan utlty system wth four feasble wheelng transactons. Table II shows the values of feasble transactons. Tarff costs are calculated usng MW-Mle approaches and results obtaned for the test system. Fg. 4 shows the tarff for reverse approach. The tarffs for the bus no.,2,3,4,5,6,28,29 and 3are found zero as load s not connected to these buses and no charges are beng pad. The wheelng charges are also varyng evenly for all feasble transactons. Fg. 5 and Fg. 6 presents tarff for domnant and absolute approach. Absolute approach gves the maxmum value of tarff as shown n Fg.6. It s observed that the results obtaned from the reverse, domnant and absolute approaches are farly accurate. The mnmum wheelng charges are obtaned for the bus no.36. It s near to generator that favors the system n all three approaches. It could be used for customer and ndustry promoton. The values of mnmum charges are tabulated n Table III. The result obtaned shows that the tarff s rased by ncreasng the value of transacton. Table IV presents the total transmsson cost for the test system usng MW-Mle approaches and postage stamp methods. It ndcates that MW- Mle method does not recover the total payment. The postage stamp method s beng appled to allocate the total cost. Absolute approach recovers the hghest cost and recovery of total cost by MW-Mle method s also mproved by the transacton. It ncreases as the transacton moved up. Fg. 7 shows that voltage varaton for computng the cost of these transactons. Results found reasonable and vary wthn permssble range. Voltage vares to close to reference base value wth and wthout transacton. 6

7 TABLE II.DETAILS OF FEASIBLE TRANSACTIONS Transacton From To Bus No. Value of Transacton (MW) T T T T TABLE III. WHEELING CHARGE ($-Mllon/MW/Year) Transacton Bus Transacton (MW) No. Reverse Domnant Absolute T T T T TABLE IV PAYMENT (MW-MILE AND POSTAGE STAMP METHOD) $-MILLION S.No. Total Load (MW) Transacton(MW) Reverse Postage Domnant Postage Absolute Postage VI. CONCLUSION In ths paper, a case study s presented to estmate the transmsson prcng of deregulated North Indan power system. MW-Mle method and smultaneously feasble wheelng transactons have been carred out at 37-bus real test system. Obtaned wheelng charges do not have sgnfcant varatons among the four wheelng transactons. MW-Mle does not recover the total transmsson cost, postage stamp method s appled at the system to share the costs assocated wth unused capacty. From the analyss, t s very much clear that f MW-Mle and postage stamp methods are appled strategcally then the transmsson prcng could be calculated wth more accuracy. Both the methods also fulfll the objectve of transmsson prcng.e. cost coverage, transparency, return to nvestors, effcency and relablty n developng deregulated power maret. The methodology produced and results obtaned are of practcal use for optmal operaton of the power maret and also ensure the economc advantages for the transmsson companes. 7

8 APPENDIX Table A NAMES OF BUSES-INDIAN UTILITY-37 BUS SYSTEM Bus Name Bus Name KTPS (Generator) 20 Sangod 2 Saatpura (220 V) 2 Gopal Mll 3 Mora (220 V) 22 Mahveer Nagar 4 Jhalawar (220 V) 23 Industral Area 5 Bund (220 V) 24 Anta 6 Dahra (220 V) 25 Bapawar 7 MadanaTown 26 Atru 8 BhawanMand 27 ChhpaBarod 9 Kanwar 28 Chhabra(Generator) 0 Hemda 29 Kawa (220 V) Dug 30 Baran (32 V) 2 Aelera 3 Baran (220 V) 3 Baan 32 Kelwara 4 Manoharthane 33 Kawa (32 V) 5 Bund (32 V) 34 Jhalawar (32 V) 6 Hndol 35 Mora (32 V) 7 Mayla Ramganj Mand 36 Saatpura (32 V) 8 Deol Manj 37 Dahara (32 V) REFERENCES [] J.W. Marangon Lma, E. J. de Olverra, The long-term mpact of transmsson prcng, IEEE Transactons on Power Systems, vol. 3, no. 4, 998, pp [2] P.S. Kularn, O. P. Yadav, SRMC based Transmsson Prcng for Wheelng Transactons under Deregulated Envronment of Power Sector., IE (I) Journal-EL, [3] M.M, Meah, Azah Mohamed, and Salleh Serwan, Comparatve analyss of usng MW- Mle methods n transmsson cost allocaton for the Malaysa power system, Proc. of IEEE Natonal. Conf. on Power Engneerng, PECon 2003, 5-6 Dec. 2003, pp [4] Y.R.Sood, Narayana Prasad Padhy, and H. O. Gupta, A new method for allocatng embedded cost of transmsson under deregulated envronment of power system, Proc. of IEEE Int. Conf. on Electrc Utlty Deregulaton and Restructurng and Power Technologes, DRPT 2000, 4-7 Aprl 2000, pp [5] Y.M. Par, J.B.Par, J.U.Lm, and J.R. Won, An analytcal approach for transacton costs allocaton n transmsson system, IEEE Transactons on Power Systems, vol. 3, no. No. 4, 998, pp [6] J.Ferrera, Zta Vale, A. Almeda Vale and Rcardo Puga., Cost of Transmsson Transactons: Comparson and Dscusson of used Methods, Internatonal Conference on Renewable Energy and Power Qualty (ICREPQ 2003), Vgo, Espanha, [7] T.Sacey, S. Z. Zahary, Power wheelng through the West Afrcan nterconnected system, Sxth Internatonal Conference on AC and DC Power Transmsson, 29 Apr-3 May 996, pp [8] J.P. Da Slva, J. T. Sarava, and M. T. P. de Leao, Use of power flow based embedded methods to set tarffs for use of networs-a case study usng the Portuguese transmsson company, IEEE Power Tech Proceedngs, 200 Porto., 200. [9] M.M. Delshad, I. Rahmat, and M. S. Ghazzadeh, Transmsson prcng n Iran electrcty maret, IEEE Internatonal Conference on Power and Energy (PECon), 200, 29 Nov- Dec 200, pp [0] Government of Inda, The Electrcty Act, 2003, The Gazette of Inda, Extraordnary, 2003, New Delh, June 2003, nal.jsp. [] Central Electrcty Authorty of Inda, f [2] N.Kumar, Y. V. R Reddy, D. Das, and N.P.Padhy, Exstng transmsson chargng practces n Inda: Dscouragng for power maret, Power Systems Conference and Exposton (PSCE), 20 IEEE/PES, March 20, pp. -7. [3] J. Roselne, Antha, and B. L. Mathur, Taml Nadu power sector reform and restructurng a case study, 4th IEEE 8

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