Transmission Congestion Pricing and Reliability Management

Hung-po Chao
EPRI and Stanford
hchao@epri.com

Abstract
In this paper, we consider transmission congestion pricing by incorporating the cost of congestion, i.e. reliability management, explicitly. We explore alternative market mechanisms and equilibrium concepts that accommodate supply functions of firm transmission rights. In particular, we examine the implications of congestion pricing for efficient resource allocation in centrally planned, competitive and oligopolistic environments.