A fair method for centralized optimization of multi-TSO power systems

This paper addresses the problem of centralized optimization of an interconnected power system partitioned into several regions controlled by different transmission system operators (TSOs). It is assumed that those utilities have agreed to transferring some of their competencies to a centralized control center, which is in charge of setting the control variables in the entire system to satisfy every utility's individual objective. This paper proposes an objective method for centralized optimization of such multi-TSO power systems. which relies on the assumption that each TSO has a real-valued optimization function focusing on its control area only. This method is illustrated on the IEEE 118 bus system partitioned into three TSOs. It is applied to the optimal reactive power dispatch problem, where the control variables are the voltage settings for generators and compensators. After showing that the method has some properties of fairness, namely freedom from envy, efficiency, accountability, and altruism, we emphasize its robustness with respect to certain biased behavior of the different TSOs. (C) 2009 Elsevier Ltd. All rights reserved.