Real-time pricing of reactive power considering value of reactive power resources

Reactive power service is a significant part of ancillary service in the power market. It is also a necessary condition for ensuring the safety and stability in operation of power system and successful trading of power energy. In this paper, a method of equivalent reactive power compensation (ERC) is improved to measure the difference among reactive power resource value. An average method is proposed to define reactive value factors which are introduced to the optimal power flow (OPF) model. Then the real-time pricing model of reactive power is presented when both reactive power cost and value of reactive power resource are taken into consideration. The simulation results in the Wald-Hale 6-bus system shows that the model makes the system get more reactive power from reactive generations that have larger reactive power resource value and it also improves security and stabilization of power system.