Title of Course:

“Economic Operation of Power Systems”

Prof. Eng. Ibrahim Nassar

ibrahim.nassar@azhar.edu.eg
ibrahim1061877@yahoo.com

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Overview
• Introduction

• Economic Distribution of Loads between the Units of a Plant

(Economic Dispatch)

• Generating Limits

• Economic Sharing of Loads between Different Plants

• Automatic Generation Control (LFC (Load Frequency Control))

• Coordination between LFC and Economic Dispatch

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• A good business practice is the one in which the production
cost is minimized without sacrificing the quality.

• The main aim here is to reduce the production cost while

maintaining the voltage magnitudes at each bus.

• A power plant has to cater to load conditions all throughout the

day (summer or winter)

• The power generation must vary according to the load pattern,

which may in turn vary with season. Therefore, the economic
operation must take into account the load condition at all
times.

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Economic Operation of Power Systems
• In an early attempt at economic operation it was decided to
supply power from the most efficient plant at light load
conditions.
• As the load increased, the power was supplied by this most
efficient plant till the point of maximum efficiency of this plant
was reached.
• With further increase in load, the next most efficient plant
would supply power till its maximum efficiency is reached.
• In this way the power would be supplied by the most efficient
to the least efficient plant to reach the peak demand.
• Unfortunately however, this method failed to minimize the total
cost of electricity generation.
• We must therefore search for alternative method which takes
into account the total cost generation of all the units of a plant
that is supplying a load
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Economic Distribution of Loads between Units within a Plant
To determine the economic distribution of a load
amongst the different units of a plant,
• the variable operating costs of each unit must be
expressed in terms of its power output.

• The fuel cost is the main cost in a thermal or nuclear

unit

• Other costs, such as the operation and maintenance

costs, can also be expressed in terms of the power
output.
• Fixed costs, such as the capital cost, depreciation
etc., are not included in the fuel cost.
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Performance Curves

Input-Output Curve
a plot of the input in British
Thermal units (Btu) per hour
versus the power output of
the plant in MW

input
Incremental Fuel Rate Curve output
The incremental fuel rate is
equal to a small change in
input divided by the
corresponding change in
output.
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 Incremental cost curve
The incremental cost is the
product of incremental fuel rate
and fuel cost ($/BTU) and the
curve, the unit of the incremental
fuel cost is $/ MWhr.

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 To minimize total system generating
costs we develop cost relationships
between cost of power output and
operating costs, input

Stack

Boiler Thermal Turbine Cooling

Generator Tower

Condenser

Pump

Coal
feed
er Burner
Body of
10
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• Typically curves can be approximated using
– quadratic or cubic functions
– piecewise linear functions
• Relying on the quadratic nature of HR, we will use a
quadratic cost equation
• Standard quadratic representation is...?

ai 2
fi = Pi + bi Pi + ci $ / h
2

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The fuel requirement of each generator is given in
terms of the dollar/hour
Where ai 2
fi = Pi + bi Pi + ci $ / h
• f i input to unit i, $/h 2
• Pi output of unit i MW,
• a, b, c are constants
The operating cost given by the above quadratic
equation is obtained by approximating the power in
MW versus the cost in Dollar curve
The incremental operating cost of each unit is then
computed as
df i
i = = ai Pi + bi $/MWh
dPi
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For N units

i =
df i
= ai Pi + bi i − bi
$/MWh Pi = MW
dPi ai
T = aT Pi + bT $/MWh
N
PT =  Pi = P1 + P2 + ...... MW
i =1
−1
 1 N
aT =   
 i =1 ai 
 N bi 
bT = aT   
 i =1 ai 

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Ex.

• Let us now assume that only two units having different

incremental costs supply a load.

• There will be a reduction in cost if some amount of load is

transferred from the unit with higher incremental cost to the
unit with lower incremental cost.

• The load is transferred from the less efficient unit to the more
efficient unit thereby reducing the total operation cost.

• The load transfer will continue till the incremental costs of both
the units are same. This will be optimum point of operation for
both the units.

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BTU: It is the amount of energy
needed to cool or heat one pound of
water by one degree Fahrenheit.

1 B.T.U. = 1 lb × 1ºF = 453·6 gm × 5/9 ºC

= 252 calories
= 252 × 4·18Joules
= 1053 Joules
1 B.T.U. = 1053 Joules

1 kWh = 36 × 105 Joules

= (36 × 105)/1053 B.T.U.
= 3418 B.T.U.

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 Ex.

Incremental fuel costs In dollars per megawatt hour for a plant

consisting of two units are given by

df1
1 = = 0.008P1 + 8 $/MWh
dP1
df 2
2 = = 0.0096P2 + 6.4..$/MWh
dP2

Assume that both units are operating at all times, that total load
varies from 250 to 1250 MW, and that maximum and minimum
loads on each unit are to be 625 and 100 MW, respectively.
Find the incremental fuel cost of the plant and
the allocation of load between unit s for t he minimum cost of
various total loads.

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 df 2
2 = = 0.0096P2 + 6.4 = 0.0096 *150 + 6.4 = 7.84 $/MWh
dP2
df1
PT  250 → 1250 1 = = 0.008P1 + 8  1 = 0.008 *100 + 8 = 8.8 $/MWh
dP1
P1  100 → 625
1 = 8.8 → 2 = 7.84 T = aT Pi + bT $/MWh
P2  150 → 625
1 = 13 → 2 = 12.4

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 P1 and P2

PT

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Example : Consider two units of a plant that have fuel costs of
−1 −1
f1 =
0.8 2  N 1
P1 + 10 P1 + 25...$ / h....and  1 1 
2 aT =    =  +  = 0.37333
0.7 2  i =1 ai   0.8 0.7 
f2 = P2 + 6 P2 + 20....$ / h
2  N bi   10 6 
T 
b
Then the incremental costs will be T = a  
 = 0.373333 +  = 7.8666
 i =1 ai   0.8 0.7 
1 =
df1
= 0.8P1 + 10...$ / MWh...and
T = aT Pi + bT = 90 $/MWh
dP1 i − bi 90 - 10
df 2 Pi = = = 100 MW
2 = = 0.7 P2 + 6...$ / MWh N
ai 0.8
dP2
PT =  Pi = P1 + P2 + ......  P2 = 220 - 100 = 120 MW
i =1

If these two units together supply a total of 220 MW, then P1 = 100 MW and P2
= 120 MW will result in an incremental cost of

1 = 80 + 10 = 90..$ / MWh
2 = 84 + 6 = 90..$ / MWh
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This implies that the incremental costs of both the units will be
same, i.e., the cost of one extra MW of generation will be 90
$/MWh. Then we have
0.8
f1 = 1002 + 10 100 + 25 = 5025..$ / h..and
2
0.7
f2 = 1202 + 6 120 + 20 = 5780..$ / h
2
and total cost of generation is fT = f1 + f 2 = 10,805..$ / h
Now assume that we operate instead with P1 = 90 MW and P2
= 130 MW. Then the individual cost of each unit will be
0.8 2
f1 = 90 + 10  90 + 25 = 4,165..$ / h..and
2
0.7
f2 = 1302 + 6 130 + 20 = 6,175..$ / h
2

and total cost of generation is fT = f1 + f 2 = 10,880..$ / h

This implies that an additional cost of $ 75 is incurred for each
hour of operation with this non-optimal setting.
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Similarly it can be shown that the load is shared equally by the
two units, i.e. P1 = P2 = 110 MW, then the total cost is again
10,880 $/h. f =
0.8
110 + 10 110 + 25 = 5965..$ / h..and
2
1
2
0.7
f2 = 1102 + 6 110 + 20 = 4915..$ / h
2

and total cost of generation is fT = f1 + f 2 = 10,880..$ / h

The above principle can be extended to plants with a total of
N number of units. The total fuel cost will then be the
summation of the individual fuel cost fi, i = 1, , N of each
N
f = f + f ++ f =  f
unit, i.e., T 1 2 N
k =1
k

Let us denote that the total power that the plant is required to
supply by PT, such that N
PT = P1 + P2 +  + PN =  Pk
k =1
The objective is minimizing fT for a given PT. This can be
achieved when the total difference dfT becomes zero
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The objective is minimizing fT for a given PT. This can be
achieved when the total difference dfT becomes zero
fT f f
dfT = dP1 + T dP2 +  + T dPN = 0
P1 P2 PN
Now since the power supplied is assumed to be constant we
have
dPT = dP1 + dP2 +  + dPN = 0
Multiplying both equations by  and combing we get
 f T   f T   f T 
 −  dP1 +  −  dP2 +  +  −  dPN = 0
 P1   P2   PN 
df1 df 2 df N
= = ==
dPi dP2 dPN

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Generating Limits
• It is not always necessary that all the units of a plant are available to share
a load.
• Some of the units may be taken off due to scheduled maintenance.
• Also it is not necessary that the less efficient units are switched off during
off peak hours.
• There is a certain amount of shut down and start up costs associated with
shutting down a unit during the off peak hours and servicing it back on-line
during the peak hours.
• To complicate the problem further, it may take about eight hours or more to
restore the boiler of a unit and synchronizing the unit with the bus.
• To meet the sudden change in the power demand, it may therefore be
necessary to keep more units than it necessary to meet the load demand
during that time.
• This safety margin in generation is called spinning reserve.
• The optimal load dispatch problem must then incorporate this start up and
shut down cost for without endangering the system security.

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 Pmin, i  Pi  Pmax,i , i = 1, , N
• The maximum limit Pmax is the upper limit of power generation capacity of
each unit.

• On the other hand, the lower limit Pmin pertains to the thermal consideration
of operating a boiler in a thermal or nuclear generating station.

• An operational unit must produce a minimum amount of power such that

the boiler thermal components are stabilized at the minimum design
operating temperature.

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Example : let us consider a generating station that contains a
total number of three generating units. The fuel costs of these
units are given by f = 0.8 P 2 + 10P + 25...$ / h....and
1 1 1
2
0.7 2
f2 = P2 + 5P2 + 20
2
0.95 2
f3 = P3 + 15P3 + 35
2
The generation limits of the units are 30 MW  P1  500 MW....and
30 MW  P2  500 MW
30 MW  P3  250 MW
The total load that these units supply varies between 90 MW and
1250 MW. Assuming that all the three units are operational all the
time, we have to compute the economic operating settings as the
load changes.

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The incremental costs of these At the minimum load the
units are incremental cost of the units are
df1
= 0.8 P1 + 10...$ / MWh....and df1
= 0.8 P1 + 10 = 34..$ / MWh....and
dP1 dP1
df 2
= 0.7 P2 + 5 df 2
= 0.7 P2 + 5 = 26
dP2 dP2
df 3
= 0.95P3 + 15 df 3
= 0.95P3 + 15 = 34.5
dP3 dP3
• Since units 1 and 3 have higher incremental cost, they must therefore
operate at 30 MW each.
• The incremental cost during this time will be due to unit-2 and will be equal
to 26 $/MWh.
• With the generation of units 1 and 3 remaining constant, the generation of
unit-2 is increased till its incremental cost is equal to that of unit-1, i.e., 34
$/MWh.
• This is achieved when P2 is equal to 41.4286 MW, at a total power of
101.4286 MW.

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 df1
= 0.8 P1 + 10 = 34..$ / MWh
dP1
PT (MW) P1 (MW) P2 (MW) P3 (MW)  ($/MWh) df 2
= 0.7 P2 + 5 = 26
90 30 30 30 26 dP2
101.4286 30 41.4286 30 34 df 3
= 0.95P3 + 15 = 34.5
126.875 41.875 55 30 43.5 dP3
150 49.62 63.85 36.53 49.7
200 66.37 83 50.63 63.1
300 99.87 121.28 78.85 89.9
400 133.38 159.57 107.05 116.7
500 166.88 197.86 135.26 143.5 df1
= 0.8 P1 + 10 = 410..$ / MWh
600 200.38 236.15 163.47 170.3 dP1
700 233.88 274.43 191.69 197.1 df 2
= 0.7 P2 + 5 = 355
800 267.38 312.72 219.9 223.9 dP2
906.6964 303.125 353.5714 250 252.5 df 3
= 0.95P3 + 15 = 252.5
1181.25 431.25 500 250 355 dP3
1250 500 500 250 410

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Economic Distribution of Loads between Plants
For a system with N generating units let
N
fT = f1 + f 2 +  + f N =  f k
k =1
where fT is the cost function giving the total cost of all the fuel for the ,entire
system and is the sum of the fuel costs of the individual units f1, f2,…….fN
The total megawatt power input to the network from all the units is the sum

N
PT = P1 + P2 +  + PN =  Pk
k =1
Where P1, P2,......PN are the individual outputs of the units injected into the
network.
The total fuel cost fT of the system is a function of all the power plant outputs

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Economic Distribution of Loads between Plants
The constraining equation on the minimum value of is given by the power
balance
N
PL + PD −  Pk = 0
k =1
N

Where
PD =  PDk is the total power received by the loads and PL is the
k =1

transmission loss of the system

Objective: is to obtain a minimum fT for a fixed system load PD subject to the

power-balance
The new cost function F is formed by combining the total fuel cost and
the equality constraint
N
F = ( f1 + f 2 +  + f N ) +  ( PL + PD −  Pk )
k =1

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Economic Distribution of Loads between Plants
for minimum cost we require the derivative of F with respect to each PK to equal
zero, and so Since
dF d  N

=  ( f1 + f 2 +  + f N ) +  ( PL + PD −  Pk ) = 0
dPK dPK  k =1 

Since PD is fixed and the fuel cost of any one unit varies only if the power
output of that unit is varied dF df dP
= i
+ ( L
− 1) = 0
dPK dPK dPK
for each of the generating unit outputs P1 , P2,…….. PK. Because fi depends on
only PK, the partial derivative of fi; can be replaced by the full derivative and
then gives  
 
=  1  df i
= Li
df i
 dPL  dPK dPK
 1 −
 dPK 
where Li is called the penalty factor of plant i
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Economic Distribution of Loads between Plants
The minimum fuel cost is obtained when the incremental fuel cost of each unit
multiplied by its penalty factor is the same for all generating units in the system.
df i
 = Li
dPK
For a system of three units, not necessarily in the same power plant
df1 df df
 = L1 = L2 2 = L3 3
dP1 dP2 dP3
dPL
The penalty factor Li depends on , which is a measure of the sensitivity of
dPK
the transmission-system losses to changes in PK ; alone

 
 
 =  df i = L df i
1
 dPL  dPK i
dPK
 1 − dP 
 K 
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Example : Let us consider the two generating units

It is assumed that the transmission loss is defined in terms of the two units as

  Find Ploss and PT

  1 1
=  1  df i = L df i Li = =
  dPK i dPLoss dP
1 −
dPL dPK 1− 1 − Loss
  dP1 dP2
 dPK 

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 MW

0.7 P2 + 6
150 =
1 − 1.4  10− 5 P1 − 1.6  10− 4 P2
Rearranging the above two equations we get

0.8270 0.0021  P1  140

 0.0021 0.7240  P  = 144
  2   
The solution of the above equation produces P1 = 168.78 MW and P2 = 198.41 MW.
The total power loss is then

PLOSS = 0.9 10 −4  (168 .78 ) + 1.4 10 −5  (168 .78 ) (198 .41) + 0.8 10 −4  (198 .41) = 6.18 MW
2 2

Therefore the total power supplied to the load is

PT = P1 + P2 − PLOSS = 168.78 + 198.41 − 6.18 = 361

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The B terms are called loss coefficients or B coefficients and
B is a symmetric matrix
N N N
PL =   P i ij Pj +   i 0 Pi +  00
i =1 j =1 i =1
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Automatic Generation Control
• Electric power is generated by converting mechanical energy into electrical energy.
• The rotor mass, which contains turbine and generator units, stores kinetic energy due
to its rotation.
• This stored kinetic energy accounts for sudden increase in the load.
• Let us denote the mechanical torque input by Tm and the output electrical torque by Te.
• a generator unit is said to be operating in the steady state at a constant speed when
the difference between these two elements of torque is zero Ta = Tm − Te
• When the electric power demand increases suddenly, the electric torque increases.
• However, without any feedback mechanism to alter the mechanical torque, Tm remains
constant.
• Therefore the accelerating torque becomes negative causing a deceleration of the
rotor mass.
• As the rotor decelerates, kinetic energy is released to supply the increase in the load.
• Also note that during this time, the system frequency, which is proportional to the rotor
speed, also decreases.
• We can thus infer that any deviation in the frequency for its nominal value of 50 Hz is
indicative of the imbalance between Tm and Te.
• The frequency drops when Tm < Te and rises when Tm > Te.

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The steady state power-frequency relation

f
−R= R is called the regulating constant
Pm Or speed regulation or droop
1
Pm = Pref − f
R
Pm = Pm1 + Pm 2 +  + PmN
1 1 
= (Pref 1 + Pref 2 +  + PrefN ) −  + +  +
1
f
 R1 R2 RN 
1 1 1 
= Pref −  + +  + f → ( p.u.)
 1
R R2 R N 

 SR SR SR  f
or = Pref −  1 + 2 +  + N  → ( MW )
 R1 R2 RN  R
f
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• Pm is the total change in turbine-generator mechanical power
• Pref is the total change in the reference power settings in the power
system

frequency response characteristics

1 1 1
= + ++
R1 R2 RN

Pm = Pref − f

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Example : Consider an interconnected 50-Hz power system that contains four
turbine-generator units rated 750 MW, 500 MW, 220 MW and 110 MW. The
regulating constant of each unit is 0.05 per unit based on its own rating. Each
unit is operating on 75% of its own rating when the load is suddenly dropped
by 250 MW.
We shall choose a common base of 500 MW and calculate the rise in frequency
and drop in the mechanical power output of each unit.
new
Sbase  1 1 1 1 
Rnew = Rold  old  =  +
 1
R R
+
R
+
R
 = 63.2
4 
Sbase 2 3

R1 = 0.05 
500
= 0.033
the per unit change in load − 250/500 = − 0.5
750
R2 = 0.05
R3 = 0.05 
500
= 0.1136 f = −
Pm
=−
(− 0.5) = 0.0079 per unit
220  63.2
500 = 0.0079  50 = 0.3956 Hz
R4 = 0.05  = 0.2273
110

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 f = −
Pm
=−
(− 0.5) = 0.0079 per unit
 63.2
= 0.0079  50 = 0.3956 Hz
change in the mechanical power of each unit is calculated
f 0.0079
Pm1 = − =−  500 = −118.67 MW
R1 0.033 Or

0.0079 Pm2 is calculated to be − 79.11 MW

Pm 2 = −  500 = −79.11 MW
0.05
750
Pm1 = −79.11  = −118.67 MW
0.0079 500
Pm3 = −  500 = −34.81 MW
0.1136
220
Pm3 = −79.11  = −34.81 MW
500
0.0079
Pm 4 = −  500 = −17.41 MW
0.2273 110
Pm3 = −79.11  = −17.41 MW
500

This implies that each turbine-generator unit shares the load

change in accordance with its own rating.
250 MW

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  SR SR S R  f
Pm = Pref −  1 + 2 +  + N 
 R1 R2 RN  f R
 300 500 600  0.3
= 0− + +  = −231( MW )
 0.05 0.04 0.03  50

S R1 f 300 0.3
Pm1 = − =− → (−36MW )
R1 f R 0.05 50
500 0.3
Pm2 = − = (−75MW )
0.04 50
600 0.3
Pm3 = − = (−120MW )
0.03 50

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Load Frequency Control
• Hold the frequency constant (f = 0) against any load change. Each area must
contribute to absorb any load change such that frequency does not deviate.
• Each area must maintain the tie-line power flow to its pre-specified value.

area control error (ACE)

ACE = (Ptie − Psch ) + B f f = Ptie + B f f

where
Ptie tie-line power
Psch scheduled power through tie-line
Bf frequency bias constant.

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 ACE = (Ptie − Psch ) + B f f = Ptie + B f f

Psch

Ptie

Bf

13/03/23 46
  S R S R S R  f
Pm = Pref −  1 + 2 + 3  → ( MW )
 1
R R 2 R 3  R
f

ACE = (Ptie − Psch ) + B f f = Ptie + B f f

 300 500 600  f
231 = 0 −  + +  → f = −0.3
 0.05 0.04 0.03  50

Pm1 = −
S R1 f
=−
300 0.3
→ ( MW )
= (631 − 400) − (10 * −58 * (−0.3)) = 57 MW
R1 f R 0.05 50
500 0.3
Pm2 = −
0.04 50
600 0.3
Pm3 = −
0.03 50

13/03/23 47
 Thank you for your attention
Professor Ibrahim Nassar

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