Transmission charges of power contracts based on relative electrical distances in open access

Transmission charge allocation is one of the major issues in transmission open access faced by the electric power industry. This paper introduces a new method of transmission charge allocation based on relative electrical distance (RED) concept. The method estimates the relative locations of load nodes with respect to the generator nodes. Transmission charges are allocated based on the relative electrical distance and the power contracts. The proposed method has been tested on typical sample systems and also on a practical 24-bus equivalent EHV power system, and results are presented for illustrative purpose. The proposed method provides better transmission tariff for maintaining system stability margins, minimum transmission loss and relieving congestion on lines