Transmission congestion management assessment in deregulated electricity market

The open access to the transmission network has resulted the problem of management of the transmission system due to congestion. Congestion occurs when the transmission network is not sufficient to transfer electric power according to the market desire. There are several alternatives schemes suitable for different electricity market structures have been proposed to manage the transmission congestion such as redispatching existing generators or dispatching generators outside the congested area to supply power. In both alternatives, congestion has costs based on differences in energy prices. Furthermore, many approaches for the congestion cost allocation and pricing have been proposed and intensely discussed in literature. However, as far as the congestion cost allocation and pricing approaches are concerned the charge due the congestion only collected from the customer (load). For example, in the case of nodal pricing, the payment collected from the consumer is in excess of the payment paid to generators. Similarly in the case of uplift cost approach, the congestion cost is only shared by consumers. These leads to unreasonable results since the generators do not care for the operation condition. This paper presents an assessment of transmission congestion management in the deregulated electricity market. Comparison among the existing methods in allocating the congestion charge to the participants is highlighted. The case study based on 3 bus system is used to illustrate the pro and con of these methods.