Voltage security constrained localized reactive power market

In this paper, design and operation of a single side auction based localized reactive power market has been proposed. Voltage control areas (VCAs) have been formed, first, by using the concept of electrical distance for system intact case. The VCAs so obtained have been modified looking at voltage variations under severe contingencies. In each VCA/zone, reactive power zonal purchasing price (RPZPP) and reactive power zonal selling price (RPZSP) have been determined at which the system operator (SO) procures reactive power from generators and sells reactive power to reactive power consumers respectively. An optimal power flow formulation has been used for settlement of the reactive power ancillary market in a competitive scenario that has been solved by mixed integer nonlinear programming (MINLP). The proposed method, for design and operation of the localized reactive power market, has been demonstrated on IEEE 24-bus reliability test system