A new network partition method using the sensitivity of marginal cost under network congestion

This paper presents a network partition method using the sensitivity of marginal cost. In a deregulated market, a transparent and simple electricity pricing system is required. Zonal pricing is well known for its simplicity and transparency. But it has a problem to divide the zones effectively. To define the zonal boundaries, the authors focus on the sensitivity of marginal cost. The patterns of sensitivities at all nodes are analyzed and nodes with same patterns are categorized to the same zone. A 39-bus IEEE test system illustrates the result derived from the authors' method.