Active Loss Allocation Systems in Radial Distribution Systems

Abstract

In the restructured power system under deregulation, proper pricing of electricity has emerged as a key issue. The cost of transmission and distribution activities needs to be allocated to the users of these networks. Among others, power losses are one of the costs to be allocated. The main difficulty faced in allocating losses is the nonlinearity between the losses and delivered power which complicates the impact of each user on network losses. The purpose of this article is to review the various loss allocation schemes as applicable to the distribution systems. These schemes have been compared considering a simple radial distribution system. Since cogeneration and distributed generation (DG) plants often generate power for on-site consumption, and a fraction of the output is for export to the grid, developers of cogeneration and DG with substantial on-site consumption can realize significant savings in transmission and distribution losses. Thus, the schemes discussed herein can help a cogeneration or DG developer estimate such distributed-loss cost savings.