A practical algorithm for transmission price allocation: bus-mixed average method

The purpose of this paper is to provide an efficient algorithm for the allocation of the transmission line price. The transmission pricing is viewed as a two-level issue in this paper. The upper level issue is how to determine the transmission price of a certain line, and the lower level issue is how to allocate the transmission line price to end-users/generators fairly and quickly. As to the lower level issue, such requirements as fairness, simply computing, and transparency, etc. must be met for the practical implementation, and this paper provides a method called the bus-mixed average method that can meet these requirements. Also this method can solve the problem of loop flow successfully. The details of the theoretical part and algorithm have been demonstrated in this paper.