A settlement method for inter-provincial electricity trading employing a modified transmission loss rate

In the current practice in China, electricity trading among various province is generally governed by relevant provincial governments, in the form of electricity contracts negotiated by two trading parties. The currently employed inter-provincial electricity trading mode and settlement method in China Southern Power Grid (CSG) are first introduced in this paper, and two main issues of the current settlement method are analyzed: 1) the issue of negative settled transmission loss rate when significant discrepancy occurs between actual electric quantity and dispatching plan; 2) the inapplicability for the increasing number of participants along with the promotion of direct power purchase by large consumers. To address these issues, a method based on a modified transmission loss rate for inter-provincial electricity trading settlement is proposed and compared with the currently employed one. Simulation results with actual trading data show the feasibility of the proposed method.