Two Area Production Cost Evaluation By the Segmentation Method

This paper develops the methodology, based on the segmentation method, to evaluate the production costs of two interconnected systems. The demand plane is divided into a grid structure, or segments, of equal size. Each segment contains the joint probability of the load in the range of the selected segment as well as the first moments of load, or equivalent load, and residual tie line capacity for each system. The methodology proposed is accurate and computationally efficient. The method is applied to the evaluation of expected energy generation, unserved energy as well as production costs of two interconnected systems. The results also compared to those utiliz Expansion.