This thesis analyzes generator reactive power dispatch under restructured power systems from two different perspectives. The first follows the two-step approach adopted by some electricity markets where first, the generators' real powers are dispatched in the energy market, followed by the dispatching of the generator reactive power support services in the ancillary services market. Once the generators' real power has been dispatched in the energy market, the generators' reactive power is dispatched according to the minimization of a combination of multiple objectives: network MW loss cost, generator opportunity cost, and generator MW shift cost. The MW loss cost is represented as a function of bus voltage magnitudes and angles as well as the nodal prices in $/MWh found in the first step. Opportunity cost is represented as a function of the generator reactive powers, whose cost parameters are derived in terms of the MW dispatch, the MW nodal prices and the generators' capabilities. The generator shift cost is represented as a function of the generator real powers and the MW shift weighting factor. As these three objectives may conflict, compromises are needed to arrive at an optimum solution. The second reactive power dispatch approach unifies real and reactive power dispatch by minimizing both MW and MVAr generation costs while enforcing the MW and MVAr/voltage constraints simultaneously. This unified dispatch avoids a disadvantage of the two-step MVAr dispatch, that is, that the MW price signal determined in the energy market may be distorted by the subsequent MVAr dispatch in the ancillary services market. Several numerical examples under different conditions are presented to examine and compare the effectiveness of these two methods.

Galiana, F. D. (Supervisor)