LMP & Sensitivity Factors

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• Park City & Sundance supply the next increment of load on the system

• Attempt to serve an additional increment of load (1 MW)

• Resulting Sensitivity Factors determine LMP

• Least Cost Security Constrained Dispatch Algorithm

• Calculates least expensive way to serve load while respecting transmission limit

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• The LPA calculates the LMP for each bus, by supplying 1 MW to each bus from a combination of the two marginal units and then determining the cost to serve that 1 MW, based on the prices and contributions of each marginal unit.