Reactive Power Ancillary Service And Its Pricing Based On The Model Of Optimal Consolidated Compensation Reactive Power Market

With the fast development of electricity markets, how to price reactive power service is getting more and more important. In this paper the pricing scheme of reactive power is studied based on the model of optimal consolidated compensation reactive power market.The paper first introduces the background of the reform of power industry, the restructuring of the power industry, current situations of electricity markets, the variety of ancillary service and its acquirement.In order to solve the problem of reactive power pricing, this paper discusses the characteristics, the content and the impressed factors of reactive power service, in detail. Different reactive power generators and their performances are clarified, new method of evaluating different kinds of generators' reactive power production cost is proposed in this paper. By introducing the reactive power market models which are put into operation in U.S.A., Europe and Australia, the paper points out that a market solution of reactive power service is the ultimate goal of the reform.This paper presents a new concept for reactive power market model, that is the reactive power market based on optimal consolidated compensation. Such a reactive power market consists of two parts: one based on capacity cost and the other base on production cost, so the investment and operation cost of reactive power generators are both compensated, and at the same time the security of power system is guaranteed. The paper also emphasizes that valuation of reactive power generatorsshould be based on not only on their natural capacity but also on their contributions to system security and reliability, so a new concept of reactive power valuation factor is introduced in computing reactive power capacity cost, as a result, the capacity cost is more scientific and reasonable. During the processing of reactive power production cost computing, the objective of OPF is the var-cost-minimizing, so the total reactive power cost is reduced.The IEEE 14 and IEEE30-node systems are introduced as test systems. The computer simulation results show that the proposed method is clear in conception and simple in application.