Placement of FACTS devices in open power market

The ongoing power system restructuring requires an opening of unused potentials of transmission systems due to environmental, right-of-way and cost problems which are major hurdles for power transmission network expansion. FACTS devices can be an alternative to reduce the flows in heavily loaded lines, resulting in an increased loadability, low system loss, improved stability of the network, reduced cost of production and fulfilled contractual requirement by controlling the power flows in the network. This paper suggests, first, the few optimal locations of FACTS devices and then determines the best optimal location in order to reduce the production cost along with the device cost. The allocation and requirement are also discussed. The effectiveness of the purposed methods is demonstrated on IEEE 14-bus system.