1
Iterative DCOPF Model Using Distributed Slack
Bus
Naren Bharatwaj. V, Student Member, IEEE, A. R. Abhyankar, Member, IEEE, P. R. Bijwe, Senior Member, IEEE
Abstract—Loss modelling in DCOPF has seen various versions
of implementation in literature. Each one of them strives to model
the losses in the most accurate manner possible, depending on
the methodology used and assumptions made, in order to obtain
locational marginal price (LMP). The methodology proposed in
this paper is a variant of the iterative DC approach. In this
model, the choice of slack bus changes the solution in terms of
cost and LMPs. Instead of keeping β constant based on load
magnitude, it is shown that initializing the iterative algorithm by
appropriate slack distribution variable (β), and updated based
on dispatch obtained, a better solution can be obtained. This in-
turn has an effect on the loss factors and Generation Shift Factor
(GSF), which are a function of β. This leads to a different set of
LMPs. With a suitable choice of β, a reasonable result in terms
of cost and closeness of LMPs with ACOPF can be obtained.
Index Terms—DCOPF, Marginal Pricing, Loss Modelling, Loss
Distribution
N OMENCLATURE
Ci (P gi ) Cost of power production of generator i
P gi Power generation at bus i
P di Load demand at bus i
PLoss Total active power loss
LFi Loss factor at bus i
max
f lowL Vector of line power flow limits
GSF Generation Shift Factor
Pg Vector of Power Generation
Pd Vector of Load Demand
P gimin Minimum limit for generation at bus i
P gimax Maximum limit for generation at bus i
D Loss Distribution Vector
FND Vector of fictitious nodal demands
θ Vector of load angles
X Reactance Matrix
β Slack distribution variable
xl Reactance of line l
n Number of buses
M Number of transmission lines
I. I NTRODUCTION
HE Locational Marginal Pricing (LMP) approach is an
T essential tool for settling transactions and is used for
market clearing in the North American power market [1].
By obtaining a centralized dispatch schedule for the market
participants, the LMP mechanism not only provides short-term
Naren Bharatwaj. V (email: naren.bharatwaj@gmail.com), A. R. Ab-
hyankar (email: abhyankar@ee.iitd.ac.in), and P. R. Bijwe (email: prbi-
jwe@ee.iitd.ac.in) are with Department of Electrical Engineering, Indian
Institute of Technology Delhi, NewDelhi, INDIA.
978-1-4673-2729-9/12/$31.00 ©2012 IEEE
energy prices but also performs congestion management in the
most effective way.
Calculation of LMP can be done using two different dis-
patch philosophies: ACOPF and DCOPF. Both have their
advantages and short-comings. Some driving factors for the
use of DCOPF in obtaining LMPs are its relative simplicity,
speed of convergence and the availability of LMP components.
ACOPF, on the other hand, is complex compared to DCOPF.
LMPs obtained from ACOPF need to be decomposed using
additional techniques. The individual components of LMP are
necessary for settlement in the market.
Even though the lossless DCOPF approach is simple to
formulate, it neglects losses on the whole. For a large power
system, the losses can be quite large and its impact on the
LMP can’t be ignored. Literature has focused on how best
to incorporate losses in the dispatch as well as calculation of
LMP. Though a good amount of literature is available, only
those publications that are found relevant to the subject matter
under consideration are discussed next. In one of the first
models given in [2], the losses appear in the global power
balance equation. However, no mention has been made on
the location for loss distribution. Hence, all the losses will
be supplied by slack/reference bus, which makes the method
slack dependent. Loss distribution has an effect on line power
flows, which affects the LMP value. The seminal work for
incorporating losses as part of the dispatch and its effect on
line power flows was proposed in [2]. In this paper, a vector
loss distribution concept was proposed. The total losses in the
system was added as additional load to various buses using
this vector. While this method proposed a way to distribute
losses, the results were heavily dependent on the choice of
loss distribution vector (D).
Ref. [3] proposed an iterative technique that used DC loss
factors to incorporate losses. While this method provides more
accurate results, the results are dependent on the choice of
slack bus. The DC loss factors are dependent on GSF , which
is again dependent on the choice of slack/reference bus. It
is because of this coupling that the results of this method
are dependent on slack/reference bus. A hybrid version of
the methods proposed in [2] and [3] is proposed in [4]. In
2008, a matrix loss distribution for losses was proposed in
[5]. This method achieved enhanced power flow accuracy by
distributing losses on a line to more than two buses. Another
benefit of this method is that the proportion of loss distribution
of one line can be different from another. However, the choice
of this matrix (K) has to be trial and error. Further, this paper
focused more on proposing a method that is compatible with
FTRs and reference independency.
 2

An iterative approach that uses AC loss factors evaluated
from NRLF Jacobian was proposed in [1]. This method
is similar to the iterative technique proposed in [3]. The
calculation of loss factors is using ACPF instead of DC
approximation. This method is reference independent. In 2011,
another reference independent method to calculate LMP was
proposed in [6]. This is a non-iterative technique that uses
DC loss factors. The method aims to obtain reference inde-
pendent loss factors. These factors are evaluated on the lossless
DCOPF snapshot or ACOPF. The main focus is on obtaining
a reference independent value of the sensitivity of power flow
on a line with power injection at a bus. When evaluating loss
factors using DC approximation, this sensitivity is the GSF
value (as seen in (14)) of bus i with various lines. [6] aims
to arrive at this value based on network topology and present
operating condition.
All the aforementioned methods can be classified as either
II. I TERATIVE DC M ODEL
In this section, we will look into the mathematical mod-
elling of two methods that have used DC approximation for
calculation of loss factors. It is assumed that the loads are
inelastic and the objective function is cost minimization.
A. Non-Iterative DCLF model
In [6], a non-iterative reference independent LMP de-
composition method is proposed that uses DC loss factors and
distributed slack bus. This model is a hybrid version of the
loss distribution vector (D) model [2] and the iterative DC
technique proposed in [3]. The mathematical formulation of
this model is given below.

n
Minimize Ci (P gi ) (1)
i=1

iterative or non-iterative. Further, these can be classified based Such that:  

on the use of AC loss factors or obtaining loss factors from P gi − P di = Ploss (2)
DC approximation. From the literature review, the following 
conclusions can be drawn of what is expected of a model that Ploss = (LFi ) × (P gi − P di ) + offset term (3)
evaluates LMP using DCOPF. max
−f lowL ≤ GSF × D × Ploss ≤ max
f lowL (4)
1) Reference independent LMP components P gimin ≤ P gi ≤ P gimax (5)
2) Difference in congestion and loss components should be
same irrespective of choice of slack Where,
3) Consistency in financial settlements F N Di
Di =  (6)
The proposed work in this paper is based on the iterative F N Di
DC model given in [3]. This algorithm is characterized by ∀i
iterative use of DC loss factor calculation. F N Di is given by (7).
Choosing a single slack bus has curse of arbitrariness in 
F N Di = 0.5 × P lossl (7)
the choice of the same. Further, there could always be a
∀l∈NL
better solution obtained using another choice of slack bus.
The use of a distributed reference is not a new concept in where, NL is the subset of lines connected to bus i.
itself and has been used in [2], [4], [7], [8]. The reference The LMP decomposition for this optimization problem is
is distributed across all load buses. The basis for reference straight forward and is not described here. The arbitrariness
distribution is the load magnitude on that bus and hence the in the formation of D is overcome by making use of fictitious
name Distributed Load Reference (DLR). However, such a nodal demand (FND) to evaluate entries in D.
pre-fixed reference distribution may not give the most optimal
dispatch in terms of generation cost. Instead of pre-fixing the B. Iterative DC Model
distributed reference and keeping it constant throughout, we In this section, we will look into the mathematical modelling
propose the use of distributed slack bus to calculate GSF, of the iterative DC model proposed in [3]. In this model, first,
where the reference distribution is updated in every iteration a lossless DCOPF is solved to obtain the loss factors (LF) and
based on the dispatch obtained. It is proved through results that offset, which are then used in the main iteration as estimated
a compromise solution in terms of cost and closeness of LMPs values. The LFs and offset are updated after every iteration
can be obtained if reference distribution is updated iteratively. till convergence is reached. The mathematical formulation of
Thus, a pre-set rule of distributed slack bus is invoked and the this model is given below.
participation factor (β) is updated after every iteration. This
is the novelty of the proposed approach compared to prior art 
n

[2], [4], [7], [8]. The participation factor (β) is initialized from Minimize Ci (P gi ) (8)
i=1
the lossless DCOPF snapshot.
Such that:  
This paper is organized as follows. Section II delves into
P gi − P di = Ploss (9)
the mathematical modelling of two relevant methods given
in literature. Section III highlights the motivation for the 
Ploss = (LFi ) × (P gi − P di ) + offset term (10)
proposed method and the mathematical model. Section IV
max max
provides the results on the PJM 5 bus system and the IEEE −f lowL ≤ GSF × (Pg − Pd − FND) ≤ f lowL
30 bus system. Section V concludes the paper. (11)
 3

P gimin ≤ P gi ≤ P gimax (12) However, for a given set of power injections, the line flows
are unique.
Even though this model is more accurate in estimating the The calculation of loss factors using DC approximation is
losses, it has two drawbacks - 1) Decomposition of LMPs as follows.
into the respective components is not reference independent M
2) Arbitrariness in the form of choice of reference bus PLoss = f lowl2 × Rl (13)
Halving the losses occurring on a line and adding them l=1
as additional load to the buses connecting the line provides
a reasonable approximation in terms of power flow. The M 
∂PLoss ∂ 
calculation of loss factors in this approach is using a DC = f lowl2 × Rl
approximation. It is proved in [3] that the summation of ∂Pi ∂Pi
l=1
product of loss factor and power injection produces double 
M
∂  
the system loss. = f lowl2 × Rl
∂Pi
The loss factors calculated using ACPF depend on the l=1
sensitivity calculated from the sensitivity matrix relating power 
M
∂f lowl
injection and load angle. There is no direct relation between = Rl × 2f lowl ×
∂Pi
the loss factor and the GSF. However, since the DC approxima- l=1
⎛ ⎞
tion is a linear model to calculate loss factors, the loss factor M N

expression is a function of the GSF value. The loss factors LFi = 2 × Rl × GSFl−i × ⎝ GSFl−j × Pj ⎠
calculated using ACPF require the solution of converged power l=1 j=1

flow because they use the sensitivity from the last iteration
Jacobian matrix. DC approximation, on the other hand, is
simpler to evaluate. However, methods that used DC loss
factors have their results dependent on choice of reference
bus. The coupling between the GSF value and the LF is
the reason why the results are slack dependent. In [6], the
author attempts to obtain a reference independent sensitivity
of line power flow with power injection at a bus. In the DC
approximation, this sensitivity is the GSF value. GSF value
is further dependent on the choice of reference bus. Since
choice of slack/reference is arbitrary, we propose the use of
distributed slack to calculate loss factors and thus LMPs.
The use of distributed reference bus in calculation of
LMP is not a new concept in itself. Calculation of GSF
using distributed reference is mentioned in [2] and [6]. Since
the former uses fast de-coupled load flow for loss factor
calculation, the reference bus dependency is not primarily
due to loss factors. The latter demonstrates the reference
bus independency of the method by using distributed slack
formulation for calculation of GSF . The choice of slack
distribution variable (β) is made based on load magnitude at
buses. Being a non-iterative technique, the β values remain
fixed. In the proposed approach, a clear rationale is given for
the initial choice of β and it is updated after every iteration.
In the next section, we will look at how the DC loss factors
are calculated and the coupling that exists between the GSF
value and the LF value.
III. D ISTRIBUTED SLACK MODEL FOR CALCULATION OF
LF
A. Motivation
The loss factors calculated in the iterative DC technique
are a function of Generation Shift Factors (GSF ). While
evaluating the GSF , a slack/reference bus must be assumed
that takes up the shift in generation. Since the choice of
reference bus is not unique, the set of GSFs obtained can have
(14)
From the above equations, it can be deduced that the LF
value is a function of GSF , and GSF , a function of the
choice of slack bus. By choosing different slack buses, the
GSF values will change, but the flows will remain same for
a fixed set of injections. Since LF changes for change in
slack bus, the solution is different for different slack buses.
This is the primary reason why the DC iterative technique is
slack dependent. In fact, any technique using DC loss factors
is reference dependent. In a nutshell, a particular choice of
reference bus would provide the best (or worst) solution in
terms of closeness of LMPs to those calculated using ACOPF.
On the other hand, some other choice of slack bus would
provide best (or worst) solution in terms of social-welfare/cost.
Since the best choice of slack bus cannot be defined a priori,
any arbitrary choice of reference bus may obtain the worst
solution. A compromise can be obtained if distributed slack is
employed.
B. Proposed Method
In the proposed method, the GSF values are calculated
after every iteration. The β value for all generator buses is
calculated from the lossless DCOPF dispatch using (15) for
the first iteration. Based on the dispatch obtained after the
end of every iteration, the β value is updated. Hence, for the
k + 1th iteration, dispatch results of k th iteration are used. k
is iteration index and i is bus index.
P gk
βik+1 =  i (15)
P gik
∀i
The calculation of GSF for single slack bus is well known
and can be found in [9]. Instead of using a single slack for
GSF calculation, the calculation for distributed slack is shown
below.
    
many solutions depending upon the choice of reference bus. θ = X Pg − Pd (16)
 4

In the incremental model,

      

n   
Δθ = X ΔP (17) L= Ci (P gi ) −λ P gi − P di − Ploss
i=1
⎡ ⎤k+1 ⎡ ⎤k+1  
Δθ1 −β1k ΔPi 
M 
N
− μfl GSFi−l (P gi − P di − F N Di ) − max
f lowL
⎢ .. ⎥ ⎢ .. ⎥
⎢ . ⎥ ⎢ . ⎥ l=1 i=1
⎢ ⎥ ⎢ ⎥  
⎢ Δθi ⎥ ⎢ΔPi − βik ΔPi ⎥ M 
N
⎢ ⎥ ⎢ ⎥
⎢ .. ⎥  ⎢ .. ⎥ − μbl −f lowL
max
− GSFi−l (P gi − P di − F N Di )
⎢ . ⎥ ⎢ . ⎥
⎢ ⎥ = X ⎢ ⎥ (18) l=1 i=1
⎢Δθm ⎥ ⎢ −β k ΔPi ⎥ (22)
⎢ ⎥ ⎢ m ⎥
⎢ Δθn ⎥ ⎢ −β k ΔPi ⎥
⎢ ⎥ ⎢ n ⎥ M 
⎢ . ⎥ ⎢ .. ⎥
⎣ .. ⎦ ⎣ . ⎦ ∂L  f 
LM Pi = = λ−LFi ×λ+ μl − μl × GSFi−l
b
Δθz −βz ΔPi
k
∂P di
l=1
(23)
Δf lowlk+1 From (23), the LMP can be written in 3 distinct components
k+1
GSFi−l = (19)
ΔPik+1 namely:
LM Pie = λ
(Xmi − Xni )(1 − βik ) LM Pil = −LFi × λ
k+1
GSFi−l =
xl M  

1 N (20) LM Pic = μfl − μbl × GSFi−l
+ × (Xnz − Xmz )βzk l=1
xl z=1
z=i
IV. R ESULTS AND D ISCUSSION
(21) ensures consistency in the generation shift.
The results of the proposed method have been obtained
 on the PJM 5 bus system given in Figure 2 [3]. The results
βi = 1 (21) of the proposed method are compared with LMPs obtained
∀i
from ACOPF for closeness. A power factor of 0.95 lagging is
The algorithm of the iterative technique for calculation of assumed for all loads. The reactive power limits at generator
LMP is given in Fig. 1. The number of iterations of the buses are 150 MVar capacitive to 150 MVar inductive. Voltage
proposed method will be identical to the iterative technique limits at all buses are from 0.94 p.u. to 1.06 p.u. ACOPF is
proposed in [3]. implemented using Matpower [10]. Additionally, results are
also obtained on the IEEE 30 bus system.

A. PJM 5 bus system

A slightly modified version of the PJM 5 bus system [3]
is shown in Figure 2. The line parameters are given in Table
I and the generator bid prices and their quantity are given in
Table II.
TABLE I
L INE PARAMETERS

A-B A-D A-E B-C C-D D-E

R(%) 0.281 0.304 0.064 0.108 0.297 0.297
X(%) 2.81 3.04 0.64 1.08 2.97 2.97
Limit (MW) 999 999 999 999 999 240

Fig. 1. Flowchart of Iterative DC model

TABLE II
The lossless DCOPF solution is used to calculate β and G ENERATOR D ATA
GSF before the iterative procedure. Choosing β from the
lossless DCOPF approach is a reasonable assumption since it Generator G1 G2 G3 G4 G5
Pmax (MW) 110 100 520 200 600
is an optimal solution and is a good initial start. The problem Bid Price ($/MW) 14 15 30 35 10
formulation is identical to the one given in [3], except that
distributed slack is used to evaluate GSF and LF .
The Lagrangian (L) of the optimization problem in the Table III lists the results of the proposed method. These
iterative model is given below. include:
 5

TABLE IV
% MD OF LMP S FOR ALL BUSES

Bus Case1 Case2 Case3 Case4

1 0.359 0.402 0.313 0.434
2 0.158 0.651 0.419 1.087
3 0.046 0.390 0.559 0.777
4 0.000 0.000 0.000 0.000
5 0.000 0.000 0.000 0.000
Mean 0.113 0.289 0.258 0.460
STD 0.152 0.283 0.251 0.479

 
 LM PiDC − LM PiAC 

M DLMP (%) =   × 100 (24)
LM PiAC 
Fig. 2. PJM 5 bus system
Analogous to the comparison provided in [3], the system is
loaded from 1.0 p.u. to 1.3 p.u. in steps of 0.0005 p.u. The
1) Case1 provides results of the method proposed in [4] that mean of %M D is calculated for the proposed method and for
uses distributed reference bus to calculate GSF as given the single reference case when bus 4 is assumed as reference.
in [7], [8]. This plot is shown in Figure 3. It can be seen that for almost
2) Case2 initializes β with bus loads as reference weights all the loading levels, the mean value is lesser in the case
(i.e., 0.333, 0.333 and 0.333 respectively). β remains when β is updated every iteration than when using the single
fixed in the iterative process and is not updated [7], [8]. slack case. The two spikes at loading levels 1.089 and 1.194
3) Case3 updates β iteratively, as mentioned in the proposed are because of the difference in marginal generators between
method. ACOPF and DCOPF.
4) Case4 is the single slack case as given in [3]. A comparison of objective function values for 3 specific
loading cases are given in Table V. In the first column, for
a loading of 1.091 p.u., objective function value in Case1 is
TABLE III lesser than Case2. This trend is observed for system loading
R ESULTS OF DISTRIBUTED SLACK ON PJM 5 BUS SYSTEM
below 1.091. For a system loading of 1.0915 p.u., the cost is
LMPs in $/MW almost equal for Case1 and Case2. Beyond 1.092 p.u. loading,
Bus
1
Case1
15.847
Case2
15.854
Case3
15.840
Case4
15.859
ACOPF
15.790
the objective function value in Case2 has been observed to be
2 24.080 24.198 23.941 24.303 24.042 lesser than Case1. For all loading conditions, Case3 gives the
3 27.099 27.217 26.960 27.322 27.111
4 35.000 35.000 35.000 35.000 35.000
least objective function value. From this, one can conclude that
5 10.000 10.000 10.000 10.000 10.000 continuous updation of β ensures a minimum cost solution
Obj. 13039.706 13039.754 13035.894 13037.947 13016.043
Func in $ compared to arbitrary choice of β. The objective function
value in Case4 is always higher than Case3 for all loading
conditions .Also, Case1 doesn’t always give the lesser cost
The results include the LMPs at all buses and the objective when compared with Case2, as observed for loading beyond
function value. It is seen that updation of β iteratively produces 1.092.
the least cost dispatch. The objective function value of Case2 TABLE V
is higher than Case1 because it is an iterative technique. The C OMPARISON OF O BJECTIVE F UNCTION VALUES
losses are better estimated in the iterative technique and a
Objective Function Loading
solution closer to ACOPF is desired. To measure the closeness in $ 1.091 1.0915 1.092
of LMPs of DCOPF with ACOPF, the Maximum Difference Case1 15398.612 15412.566 15426.520
given by (24), which has been used in [3], is evaluated for Case2 15398.621 15412.565 15426.508
Case3 15393.362 15407.309 15421.256
every bus for all four cases. These results are given in Table
Case4 15395.996 15409.940 15423.884
IV. The table also contains the mean and standard deviation
(STD) of %M D for all cases. It is seen that Case1 produces
the least mean and standard deviation values. When comparing
the iterative techniques, Case3 gives a better result of 0.258,
when compared to 0.289 of Case2, where β is taken randomly. B. IEEE 30 bus system
An important point to note that the least Mean and STD values The data for IEEE 30 bus system is taken from [10]. To
do not ensure least cost solution, as seen in Case1. The results obtain LMP differential across the system, the power flow on
of the iterative DC technique when β values are updated after line connecting buses 1 and 2 has been restricted to 50 MW.
every iteration is a trade-off between least cost solution and The LMP values for all buses on the IEEE 30 bus system
closeness with ACOPF LMPs. In the iterative technique, the is given in Table VI. The different cases are similar to the
losses are better estimated based on DC loss factors. ones described earlier. Since there are 6 generators buses, the
 6

20

18

Single Slack
16 Distributed Slack
Mean LMP Difference %

14

12

10

0
1 1.05 1.1 1.15 1.2 1.25 1.3
Loading Level (in p.u. of base case)

Fig. 3. Mean LMP difference Vs. Load Level

TABLE VI
R ESULTS ON IEEE 30 B US SYSTEM

LMPs in $/MW
Bus Case1 Case2 Case3 Case4 ACOPF
Slack = 1 Slack = 2 Slack = 5 Slack = 8 Slack = 11 Slack = 13
1 20.000 20.000 20.000 20.000 20.000 20.000 20.000 20.000 20.000 20.000
2 39.725 39.701 40.205 41.112 39.753 39.483 39.797 39.834 39.909 39.939
3 33.002 33.090 33.062 33.032 33.099 32.984 33.146 33.145 33.162 32.853
4 36.079 36.192 36.140 36.071 36.203 36.065 36.262 36.259 36.279 36.016
5 40.000 40.000 40.000 40.000 40.000 40.000 40.000 40.000 40.000 40.000
6 37.886 38.019 37.921 37.775 38.028 37.887 38.112 38.099 38.067 37.865
7 39.036 39.141 39.028 38.848 39.144 39.054 39.189 39.177 39.150 39.031
8 38.145 38.298 38.149 37.913 38.304 38.166 38.453 38.363 38.324 38.122
9 37.665 37.800 37.694 37.532 37.809 37.671 37.888 37.912 37.813 37.657
10 37.549 37.685 37.574 37.404 37.693 37.556 37.770 37.813 37.678 37.546
11 37.665 37.800 37.694 37.532 37.809 37.671 37.888 37.912 37.813 37.657
12 36.689 36.804 36.756 36.696 36.815 36.671 36.879 36.841 37.000 36.661
13 36.689 36.804 36.756 36.696 36.815 36.671 36.879 36.841 37.000 36.661
14 37.406 37.569 37.395 37.117 37.574 37.434 37.618 37.573 37.706 37.378
15 37.626 37.801 37.595 37.262 37.804 37.667 37.847 37.816 37.879 37.619
16 37.315 37.459 37.332 37.135 37.466 37.327 37.528 37.531 37.524 37.293
17 37.618 37.767 37.623 37.397 37.773 37.637 37.840 37.865 37.778 37.613
18 38.140 38.342 38.062 37.602 38.342 38.208 38.378 38.366 38.343 38.171
19 38.293 38.500 38.206 37.722 38.499 38.366 38.536 38.538 38.468 38.339
20 38.133 38.324 38.071 37.656 38.325 38.192 38.372 38.384 38.295 38.166
21 37.948 38.116 37.923 37.613 38.120 37.985 38.182 38.213 38.079 37.971
22 37.930 38.096 37.907 37.602 38.100 37.966 38.163 38.193 38.063 37.952
23 38.076 38.273 38.007 37.570 38.273 38.139 38.314 38.285 38.287 38.114
24 38.358 38.561 38.278 37.811 38.560 38.428 38.607 38.586 38.516 38.439
25 38.189 38.366 38.148 37.792 38.368 38.235 38.440 38.375 38.309 38.294
26 38.853 39.080 38.731 38.148 39.076 38.947 39.125 39.050 38.968 39.061
27 37.818 37.959 37.834 37.639 37.966 37.830 38.062 37.977 37.923 37.905
28 38.100 38.251 38.107 37.880 38.258 38.119 38.348 38.317 38.278 38.087
29 38.814 39.031 38.708 38.173 39.028 38.898 39.089 38.990 38.911 39.028
30 39.472 39.738 39.286 38.526 39.729 39.604 39.768 39.659 39.563 39.809
Obj Func. in $ 6752.871 6752.635 6732.995 6727.920 6731.504 6752.443 6755.379 6752.710 6749.325 6730.100

TABLE VII
M EAN OF % MD VALUES FOR IEEE 30 BUS SYSTEM

Case1 Case2 Case3 Case4

Slack = 1 Slack = 2 Slack = 5 Slack = 8 Slack = 11 Slack = 13
Mean 0.161 0.350 0.277 0.948 0.357 0.149 0.498 0.469 0.429
STD 0.211 0.175 0.305 0.852 0.176 0.224 0.223 0.232 0.275

results for each bus chosen as reference are given. For Case1
and Case2 β is calculated using (25).
P di
βi =  (25)
P di
∀i
The least value of objective function is obtained when bus
1 is chosen as reference. However, as seen from Table VII, for
this choice of reference bus, the mean value of %M D is higher
when compared with the proposed method. Least mean %M D
is obtained when bus 5 is chosen as reference. However, the
objective function with this reference is $6752.443, which
is higher than the proposed method and the case when bus
1 is reference. The proposed method of iterative updation
of β provides a compromise solution for both aspects: least
cost dispatch and closeness of LMPs to those obtained using
ACOPF.
C. Discussion
As seen from the results, the choice of reference bus has
an effect on the final solution in the iterative DC technique.
The initial choice of β passed-on to the iterative process has
a bearing on the final solution. Since there is subjectivity in
this initial choice, it is calculated from the lossless DCOPF
solution, which is a good initial estimate. In the proposed
method, instead of a priori specification of β, it is made
a function of previous iteration dispatch. It is calculated in
an algorithmic way, rather than being hard-coded, previously
done in [2] and [4].
The choice of β should be based on what type of solution
one is interested in. It has been noticed that least cost solution
doesn’t necessarily lead to closeness of LMPs with ACOPF.
The advantage of using a distributed reference is there is
no ambiguity in the choice of reference bus, which plays
a major role in LMP and its components. Even though the
solution of the iterative DC approach is dependent on the
choice of β, the arbitrariness is overcome by initializing it
based on lossless power flow dispatch, which is a reasonable
assumption. The authors are aware that this rule can still be
challenged. However, the results show that by invoking such
a rule and updating β iteratively, the solution is guarded from
being hit at the worst end because of wrong choice of reference
bus.
As can be seen from literature, most of the approaches are
aimed at having a reference independent decomposition. Use
of DC loss factors makes this difficult. For such methods, use
of distributed reference bus arrives at a compromised solution
in terms of objective function value and closeness of LMPs
with ACOPF.
V. C ONCLUSION
This paper proposes the use of distributed slack bus in
the iterative DC technique to calculate LMPs. The earlier
approaches have proposed non-updating participation factor
based slack bus modelling instead of single slack bus. Since
iterative DCOPF technique churns out better solution as itera-
tions go by, the updated losses, which in turn act as additional
7
fictitious nodal demands, change the generator dispatches.
Instead of keeping β constant throughout the iterative process
(as done in earlier approaches), if the participation is updated
at the end of each iteration and is made proportional to
the dispatch obtained, it is shown through results that a
good trade-off is possible in terms of the optimal value of
objective function and the closeness of LMPs with ACOPF.
This safeguards the scheme from making a worst choice of
slack bus. Results on 5 bus PJM system and the IEEE 30 bus
system establish this fact.
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Naren Bharatwaj. V (S’11) is currently working towards his Ph.D. degree
in Electrical Engineering Department at IIT Delhi, India.
A. R. Abhyankar (M’04) is an Assistant Professor with Electrical Engi-
neering Department at IIT Delhi, India. His research interests include power
systems analysis, optimization and restructuring issues.
P. R. Bijwe (SM’99) is a Professor with Electrical Engineering Department
at IIT Delhi, India. His research interests include power system restructuring
issues, power system analysis and optimization, distribution systems analysis
and optimization.