Locational marginal emissions: Analysis of pollutant emission reduction through spatial management of load distribution

Environmental concerns associated with power generation drive an increasing interest in developing load management strategies to reduce pollutant emissions. Currently, no mechanism exists to directly influence pollutant emissions based on demand-side decisions. This shortcoming is addressed through the exploration of an alternative load distribution management paradigm based on the use of locational marginal emissions (LMEs). LMEs present a novel mechanism for optimizing load based on pollutant emissions. To demonstrate the application of LMEs, simulation studies using the IEEE 14-bus system and a large regional transmission system in the US (PJM) were performed and changes in CO2, SO2, and NOx emissions were quantified for varying levels of spatial load flexibility. The simulation results confirm that the proposed LME-based load management method is effective in reducing pollutant emissions in comparison to the traditional economic load distribution management method based on the locational marginal price (LMP). Emission reductions were found to become more significant as the proportion of spatially controllable loads increased. Adoption of LMEs by independent system operators (ISOs) or Regional Transmission Organizations (RTOs) would empower demand-side clients to reduce pollutant emissions based on their own load management decisions and enhance the sustainability of free-market power systems. Alternately, the LME management scheme could be automated by utilities through connections to Smart Grid compatible appliances.