Economical evaluations of reactive power supply as an ancillary service offered by distributors

Reactive power supply is one of the most important ancillary services in the field of transmission systems safety. In the current market assets, at international level, this service is differently regulated and sometimes with criteria that are not market driven. The present work is focused on the perspective to realise a reactive power market to which also the distributors can take part injecting reactive power into HV/MV connection bus bar. Under this hypothesis, the paper proposes a methodology to evaluate the economic convenience limits that the system operator would have buying the capacitive reactive power offered by distributors