A simulation tool for calculating energy prices in competitive electricity markets

This paper presents a software tool, PSS™LMP
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, for simulating true energy market operation conditions and prices using Security-Constrained Unit Commitment and Security-Constrained Economic Dispatch. PSS™LMP has been integrated with Siemens PTI’s world-wide used transmission planning tool, PSS™E
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, allowing for full transmission network modeling and providing a fundamental and essential foundation for LMP analysis. PSS™LMP analyzes the effects of network conditions and determines LMP at each node as well as energy production cost components. The core function of PSS™LMP is a 24-hour simulation for LMP-based electricity markets or energy price forecasting. Simulation results can be viewed as tables, displayed on a diagram of the network, or presented as a time-series plot. In conjunction with PSS™E, PSS™LMP can be used as a complimentary tool for market-based transmission planning.