Cost evaluation for capacitive reactive power under the deregulation environment

In this paper, the cost for capacitive reactive power is evaluated considering the deregulation environment. For the cost assessment of reactive power, the duration curve of reactive power demand is introduced and investigated. Also, a guideline is suggested to estimate the Q-cost by using the inverse of the Q-demand duration curve. In order to obtain optimal real reactive power allocation, a new algorithm is proposed by using the piecewise linearization of the inverse of the Q-demand duration curve and the LP (linear programming) technique. Under the consideration of the network constraints, the new method solves the optimal cost for capacitive reactive power to provide the system incremental cost of real and reactive powers, which plays an important role for spot pricing. The proposed method is tested with sample systems using MATLAB. The test results show that the algorithm yields reasonable reactive power allocation and provides fair cost evaluation for reactive power under the deregulation environment.