Pricing for voltage stability

Although short run reactive power pricing schemes have been discussed and debated in the literature for a decade now, voltage stability, which is often a critical determinant of reactive power allocation in many systems, has rarely been discussed in the dispatch/pricing literature. This paper presents preliminary experiences with the development of an OPF based dispatch/pricing model that optimally allocates real and dynamic reactive reserve among the generators to meet a prespecified voltage stability margin. Nodal MW and MVAr spot prices are affected by the desired stability margin because an increase in MVAr and/or MW demand has the cascading effect of increasing the dynamic MVAr/MW reserve requirement. Experiments conducted for a reduced New Zealand North Island power system reveal some interesting impacts of the voltage stability constraint on real and reactive power prices