Voltage support cost allocation

In restructured power system the main task of the system operator is to run the system with security and reliability. To maintain system security, the voltage at all the nodes must always be maintained within limits, for which system must be supported by sufficient amount of reactive power. The generators will be interested in delivering reactive power only when they get proper price for this. So, to maintain the system security, the voltage support cost must be determined appropriately. This paper proposes a circuit theory based method of allocating voltage support cost to reactive power producers which identifies and solves the problems related to existing circuit theory based reactive power cost allocation methods. The proposed method is based on only power flow result.