A day ahead price sensitive reactive power dispatch with minimum control

In this paper, a novel day ahead Price based Optimal Reactive Power Dispatch (PORPD) problem is proposed. The proposed approach aims to find the optimum real and reactive power output of thermal generators and searches for optimal operating schedule for Shunt Capacitors (SC) to minimize total reactive power supply cost. The proposed method is formulated to pay opportunity cost along with VAr supply cost of thermal generators. Moreover, the method recovers the investment cost and pays the operational cost of SC. The investment cost of SC is recovered from the depreciation cost and the operational cost is paid based on real time reactive energy cost. The SC output is made sensitive to reactive energy Marginal Price (MP) and the life span of the device is extended by obeying its operational limitations. The PORPD model is formulated as dynamic optimization problem and solved using Cuckoo Search (CS) algorithm. The program is developed on MATLAB and tested on IEEE 14 and IEEE 30 bus systems under different network complexities; like varying MP and non-linear loads. Moreover, to check the performance of CS algorithm, the results of basic PORPD problem is compared with other methods. Results confirm that the proposed method encourages the ancillary services to maintain a proactive role during higher market pricing hours and provides a guideline for the System Operator (SO) to ensure maximum operational gain for the market participants while maintaining system security.