Information structure and decomposition of large scale systems

In this paper we develop a precise formulation for decomposing a composite system into interconnected subsystems. We then develop a decomposition procedure based on information (observability) structure of the system. In decentralized systems this provides an alternative decomposition procedure to the usual one based on physical subsystems. The information structure explicitly identifies the system wide interaction variables and local variables. A two area power system is discussed in some detail to illustrate the procedure.