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Impact of Facts Devices on Restructured Electricity Market

Autor:   •  October 6, 2017  •  2,420 Words (10 Pages)  •  256 Views

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- Orissa State Electricity Board unbundled its sector into three bodies

- Haryana has announced a new power sector policy and passed Haryana Reforms Act, on the lines of Orissa

- Uttar Pradesh Government has also initiated on the Orissa Model

- Karnataka has issued policy document, outlining its proposed power sector reforms.


Some of the models for restructuring are discussed as follows:

- Single Purchasing Agent Model

- Wholesale Competition Model

5.1 Single Purchasing Agent Model

In this model, as shown in Figure 1, independent power producers (IPPs) are permitted. These may be created from existing utilities or they may be new producers who enter the market when a new plant is needed. All generating stations must sell their power, to a power pool which is turn sells, it to state distribution utilities or distribution companies in the service area. This model allows competition in generation. All power generated by generating companies (GENCOs) and IPPs must be sold to a power pool called as purchasing agency. Distribution companies (DISCOs) are only able to purchase from the purchasing agency. They do not have a choice of the purchasing agency supplying them.

[pic 4]

Power dispatch contracts (Power Purchase Agreements (PPAs)) are done through power pool. Normally, these contracts have an availability payment, designed to cover fixed costs, energy, set to cover the variable costs of generation.

Advantages:- Competition in generation sector, long term contacts remove risk of generators to loose market

5.2. Wholesale Competition Model

This model provides the choice of supplier for DISCOs together with competition in generation. DISCOs can purchase energy for their customers from any competing generator. It requires “open access” to the transmission network, and the development of a spot market. The purchasing agency concept has come to the low-voltage level rather than at the high voltage level but now it is not a single buyer model.

[pic 5]

Since this model permits open access to the transmission wires, it gives the IPPs to choose an alternative buyers. With this model the “obligation to supply” will move to the SDU and DISCOs, which still has a monopoly over the customers. They own and operate the distribution wires. In this model the ability to accommodate social policy obligations virtually disappears.

Advantages: Generators could sell their power to any distribution company.


It is a gigantic task ahead to meet the challenge of power requirement of the country and would require coherent efforts of all concerned to move with determination and accountability in a professional manner to achieve self-sufficiency in power in the coming future. To achieve this even if the Constitutions of India is required to be changed to remove “Power” from the ‘concurrent’ list to ‘central’ list, it should have been attempted early. This may have the same success story as that of other Central Sectors like Railways, Telecom etc. It will result into following major advantages.

- Transparency in functioning of Power Sector: a) actual costs of Generation, Transmission, Distribution, will be reflected through establishment of ‘buyer-seller’ relationship. b) Inefficiencies sectors get exposed on account of public scrutiny.

- Subsides to selected consumers/sectors, will have to be provided by way explicit budgetary support. This will ensure commercial operation and thereby, Survival and Growth of Power Sector.

- Consumers will be heard while fixing tariff, licensing etc., leading to empowerment of consume.

- Will result in attracting new Industries, in view of healthy Power Sector, and ample availability of Power.

- Increased consumption, by Industry, would enable higher cross-subsidization, of other sectors, leading to lower prices to the bulk of small consumers.


In spite of all advantages there also some serious problems to be faced. Some of them are

- Congestion management

- Fixation of Tariff


Operational and control of restructured electricity market possess technical challenges far more complex then conventional market. In deregulated system all IPPs will prefer shortest path, which will lead to overloading of that line which is said to be congestion. Congestion will undermine the system security and reliability viz., thermal, voltage and stability limits. Congestion in transmission system, cannot be permitted except for very short duration. Some corrective measures such as outage of congested branches (lines or transformers), using FACTS devices.


The generated voltage is routed through transmission line, tap-changing transformer and to load centers. The power is transmitted to load centers, which may be far away the line parameters should be known to calculate the transmission loss. Only real power can be transmitted to long distances and reactive power to shorter distances due to the limitation of line parameters. FACTS devices are installed in the transmission lines to enhance the real power limits and to improve the reactive power capability. FACTS devices are power electronic controllers, which have been under development for the past twenty-five years. The first generation of FACTS used mechanical switched capacitor banks. The second generation of FACTS devices is classified as series compensator (TCSC) provides power transfer enhancement and shunt compensator (SVC) supports voltage in the long transmission lines.

10. TCSC

[pic 6]

Thyristor Controlled Series Capacitor modeling is carried out to increase the transfer capability of the transmission system. TCSC id the first series FACTS controller to be developed. A rapid variable compensation


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