Transmission Congestion Management (TCM) plays a significant role in power system operation under today's deregulated environment. Its two major functions are maintaining power system within security limits and collecting money from market participants paying back to transmission grid investors. TCM issue has been widely debated during the past decade. It is still an extensively discussed opened issue in the current competitive environment. In the United States, PJM with nodal congestion management (NCM) base on renowned location marginal price (LMP) and the Electric Reliability Council of Texas (ERCOT) with zonal congestion management (ZCM), are two successful stories of TCM under different operation schemes. Though PJM model is adopted in some developing countries where the processes of restructuring is still at the beginning phase, many social economical issues, such as advance in an information technology, energy security, social equity, price volatility, and the need to subsidize poor consumers, are necessary to be addressed before the establishment of TCM and settlement processes. Taking into account the above mentioned concerns, this paper proposes a TCM model for the electrical utility industry in Thailand during the transition period to the deregulated environment. A IAS 2005 2665 0-7803-9208-6/05/$20.00 © 2005 IEEE 0-7803-9208-6/05/$20.00 © 2005 IEEE 0-7803-9208-6/05/$20.00 © 2005 IEEE 0-7803-9208-6/05/$20.00