Management of multiple congested conditions in unbundled operation of a power system

This paper studies congestion management based on congestion pricing as may be done by an independent power system operator. Four main concepts are discussed: congestion pricing can lead to the same solution as an optimal power flow; pricing need not have cost information available; good estimates of nonlinear cost coefficients are necessary; and pricing for congestion management is separable from pricing for the purpose of transmission network revenue reconciliation. Emphasis is on the determination of sufficient information by observation of the behavior of the market to permit optimum pricing without explicit communication among parties, and without generators ever being explicitly concerned about the relief of flow congestion. Results from simulated experiments are presented.