VAr sources planning based on marginal costs of reliability indices

This paper proposes a new methodology based on a decomposition technique, where the planner is called to participate in decisions related with the equipment type to be installed (fixed or controllable reactive power sources), the voltage level to be considered in the transmission grid, and the equipment/grid connection unit costs. In order to define the buses in the transmission network where the reactive sources should be installed, the marginal costs (i.e. Lagrange multipliers) associated with reliability indices, such as the expected energy not supplied or unsupplied energy cost, are evaluated. A nonsequential Monte Carlo algorithm is used to simulate all equipment failures (i.e. contingencies), and consequently to evaluate the bus reliability marginal costs. The proposed methodology is applied to the 500/230/69 kV Brazilian Northeastern transmission system, considering a VAr planning horizon of ten years.