Abstract:
A loss allocation is assigning of cost associated with transmission and distribution loss
in the electrical network. Random injection and extraction of power form network may
increase or decrease transmission loss and hence a ects system e ciency. Variation in
system e ciency due to integration of distributed generations (DGs) and loads in net-
work must re
ect in power price. Allocation of loss becomes important and serves as
a feedback signal for system e ciency improvement. Practical loss allocation algorithm
for distribution networks should be fair and give positive economic signal to the market
for improving overall e ciency of the system. In this work, cooperative game theory ap-
proach is discussed to target loss allocation problem in distribution network in presence
of DG. Cooperative game theory solution concept includes Shapley value and -value
solution concepts are discussed. Computationally feasible loss allocation using analytical
-value method is also discussed. Results for each method are compared and analyzed.
Loss allocation algorithm rewards participants which are responsible for improving sys-
tem e ciency and penalizes the participant which are responsible for deteriorating system
e ciency. Cross subsidy is reduced which gives a positive signal for integration of DGs
in the system. Discussed loss allocation methods are simple to understand, based on
load
ow result and are versatile. It gives appropriate economic signal in market for sys-
tem e ciency improvement. Loss allocation results are also used for estimating optimal
location for load and DGs integration in the distribution network.
