Zonal congestion management based on locational marginal price in deregulated electricity market

A zonal congestion management approach in a deregulated electricity market based on locational marginal price (LMP) has been proposed. Since LMP gives an economic signal and its difference at two buses across a line gives the measure of degree of congestion therefore it is efficiently used in deregulated electricity market for congestion management. This paper makes use of the difference of LMP across a link to identify different congestion zones in the system. After the identification of congestion zones, the effect of allocation of distributed generation to different potential locations of congestion zones has been analyzed in order to manage congestion. The performance of the proposed methodology has been tested on IEEE 14-bus system.