Risk Analysis of Distribution Systems Using Value at Risk Methodology

Value at Risk (VaR) is an appropriate method in financial world for evaluating risks. The method measures the losses within a considered time interval and a defined confidence level in actual currency. The simplicity and objectivity of VaR concludes to the idea to apply this method for power systems risk assessment. In this paper the methodology is applied for risk evaluation in the context of asset management in distribution systems. The discussion concerning advantages of this model in relationship to the conventional reliability is attached on the application for real distribution system.