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Transmission Expansion Planning in Deregulated Power ... - tuprints

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4 Market Based Criteria 37<br />

Fig. 4.4 – Price profile of the 8-bus network<br />

Therefore, customer buy and sell energy at less discrim<strong>in</strong>ative prices and consequently<br />

competition is encouraged. As the price profile deviate from the flatness, differences among<br />

the mean of LMP of different buses <strong>in</strong>crease, customers buy and sell at more discrim<strong>in</strong>ative<br />

prices, and consequently competition is discouraged. Therefore, the flatness of price profile is<br />

a proper criterion for measur<strong>in</strong>g the competitiveness degree of electric markets.<br />

4.2.2.1 Standard Deviation of Mean of Locational Marg<strong>in</strong>al Price<br />

Consider figure 4.3, mean of LMP of each bus is specified with a bar over it. Standard<br />

deviation of mean of LMP <strong>in</strong> the presence of plan k, where mean is taken over Nr samples and<br />

standard deviation is taken over Nb buses, is given by:<br />

σ µ<br />

k<br />

lmp<br />

=<br />

1<br />

Nb<br />

∑ Nb −1<br />

i=<br />

1<br />

(<br />

µ<br />

k<br />

lmpi<br />

−<br />

µ<br />

k 2<br />

lmp )<br />

with:<br />

k σ<br />

µ<br />

standard deviation of mean of LMP <strong>in</strong> the presence of plan k <strong>in</strong> $/MWhr<br />

lmp<br />

k<br />

lmpi<br />

(4.8)<br />

µ mean of LMP of bus i over Nr samples <strong>in</strong> the presence of plan k <strong>in</strong> $/MWhr<br />

k µ lmp mean of<br />

k µ lmp over Nb buses <strong>in</strong> $/MWhr (average LMP of the network)<br />

i

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