It is required to develop a rational transmission pricing methodology to ensure the fair participation of the player in the market. There are many methodologies studied in transmission pricing. Specially marginal cost method has been focused recently....
It is required to develop a rational transmission pricing methodology to ensure the fair participation of the player in the market. There are many methodologies studied in transmission pricing. Specially marginal cost method has been focused recently. Marginal cost method is superior to average cost method in the side of economic efficiency. But it can not use only, because it does not ensure full recovery of Transco's revenue requirements. Therefore, this may be needed to use revenue reconciliation jointly. This paper suggests new reconciliation method to allocating revenue deficit to participants based on individual line's impact on participant's surplus.