Nodal Pricing Mechanism and Method in Power Systems Considering N-1 Contingencies

With the global climate change and increasing severe weather events, more and more power system emergencies and blackouts occurred due to natural disasters. Under critical line contingencies and large-scale power flow transfer, cascading failures and blackouts may happen. Traditional locational marginal price (LMP) model ignores the power contingencies. As a result, traditional LMP model cannot reflect the security requirement and reliability cost due to preventive contingencies. In order to improve power system resilience and flexibility, this paper proposes a pricing model and method considering N-1 contingencies. Based on LMP, the marginal cost and price of adding security constraints of contingencies is analyzed and evaluated. The proposed LMP is divided into energy, congestion and security parts to obtain the security price of power system under contingencies. The IEEE-6 bus system is used to show the effectiveness.