Transmission access pricing to wheeling transactions: a reliability based approach

Due to economy of scale, several methodologies for the allocation of power transmission costs do not recover the fixed costs of transmission assets. To avoid this problem, in this paper a methodology is proposed which considers that each circuit has two functions: to allow the power transmission between two points and to assure the system reliability. Thus, the revenue of each circuit is obtained in two parts: one part that considers the system use under normal state and the second part that consider the system use under contingency conditions. Application of the methodology is illustrated on a small, but realistic test system.