LMP as Market Signal for Reserve Supply in Energy and Reserve Integrated Market

The effectiveness of locational marginal pricing as a market signal for reserve supply is discussed on the basis of network constrained integrated energy and reserve market arrangement in this paper. Revenue recovery based on LMP is explored as an assessment tool in the presence of serious network outage. The model used in this paper solved by using DC-OPF. In particular, marginal loss factor is incorporated into energy and reserve integrated market to overcome the absence of network loss price component in DC-based optimal power flow. Modified IEEE 30-bus model is used for numerical experiment