Commercialising Voltage Regulation in Nodal Electricity Spot Markets

Abstract

Nodal electricity spot markets that incorporate AC network models usually permit voltagevariation at the nodes within voltage constraints set by engineering considerations. Theseengineering constraints then influence the dispatch optimization. However, since market participantscan have widely varying tolerances with respect to voltage variation, they therefore ?value? thevoltage regulation services differently. Accordingly, it is more desirable that voltage regulation, i.e.commodity quality service, is approached by market based commercial method rather than centralisedtechnical method in the market efficiency perspective. Moreover, this approach may permit moreeffective management of power system voltages during abnormal system operating conditions. Inthis paper, we explore a mechanism for commercialising voltage regulation using a ?voltage valuefunction (VVF)? model. The conventional technical regulation and the VVF-based approach arenumerically tested and compared in order to demonstrate the properties of the VVF model.