Inclusion of Inter-Area Transmission in Production Costing Simulation

Traditionally, production costing simulation programs have ignored inter-area transmission restrictions which may, in actual daily system operation, cause suboptimal system wide generating unit dispatch. With the advent of large scale pooling and operating agreements and concomitant pool wide economic dispatch, a need has arisen for system planners to be able to recognize transmission limitations in production costing studies. This paper presents a technique which allows such limitations to be considered. In addition, the paper outlines how this tool can be used to aid system planners in determining adequate inter-area transfer capacity and give relative system-wide transmission requirements for alternate generating unit siting strategies.