Electricity transmission modeling economic impact of technical characteristics

The ongoing liberalization of the European electricity markets with the aim to achieve one integrated market requires a fundamental understanding of the technical characteristics of electricity generation and transportation. The aim of our paper is to estimate the economic implications of three different technical problems of transmission grids particularly under the projected wind capacity increase. Based on a simplified model of Northwest Europe we analyze the costs of re-dispatch under different congestion management mechanisms, the cost of supply security due to the N-1 criterion and the obtainable gains by flexible switching possibilities. The models are based on a welfare maximizing approach, power flows are calculated following the DC-Load Flow approach.