Dynamic security constrained var planning for competitive environments

This paper presents a formulation for VAR planning method for guaranteeing secure power system operation in competitive environments. The formulation is useful for the evaluation of reactive power value, for effective investment of slow and fast VAR devices, for the examination of pricing and procurement of VARs through market. Since load shedding is the last resort for keeping security, the annual expectation of the load shedding cost is used as a security index to evaluate the overall benefits of VAR resources which respond in dynamic state transitions in contingencies. The proposed formulation takes into account the multiple benefits of reactive power in a single problem, which may be useful to evaluate the real value of the VARs. It is demonstrated that the maximum cost saving is achieved by a balanced installation of SC and SVC with keeping a specified security level. A VAR procurement method through market is also investigated using the formulation.