Congestion-based transmission system expansion planning in developing Chinese power market

System expansion planning is increasingly important for the developing Chinese power market. In this paper a congestion-based system expansion planning method, suitable for the Chinese power market, is introduced. Also, a new LMP (locational marginal price) optimal plan selection method is proposed. These two new methods are applicable to a competitive power market. They minimize the total social cost, encourage competition and decrease discrimination. A simple 9-bus test case and a 28-bus system, based on the real Three-gorges transmission grid in China are presented in this paper.