Real and reactive power price of generators to load in pool based electricity market model

In this paper, reactive power cost function has been obtained for generator to supply reactive power based on the operating point of the generators on its capability curve. Based on the reactive power cost functions, a non-linear optimization problem is solved to compute both real and reactive power prices for pool electricity market model considering the minimization of fuel and reactive power cost. A upstream looking algorithm has been used to find the contribution of each generator to the load and the based on proportional sharing the marginal prices at each node have been determined for both real and reactive power to be paid to generators. The results have been determined for IEEE 24 bus test system. The results have been compared for already reported methods to determine reactive power cost.