In most countries the electric power industry has been undergoing through drastic and dramatic changes. The electrical utilities have been structured in separate generation, transmission and distribution segments bringing in a transparency in the utility business. Depending on the market structure of each country, the individual segments have also to compete in liberalized markets.
I. INTRODUCTIONThe transmission open access makes the power system a complicated mechanism in power system restructuring. A major issue in transmission open access and international electricity markets is represented by transmission cost allocation. The use of transmission network by generators or consumers is associated with the connection charge and represents operation and capital cost, loss compensation costs, internal congestion costs, costs of supply of system services, costs of system balancing and stranded costs [1].The transmission costing [2] may vary from a simple postage stamp type model over MW-Mile method to complex power flow based models. Postage stamp, also know as pro rata [3] is the simplest design, and hence the most common in immature markets. The MW-mile method [4] is an embedded cost method and calculates charges associated with each transaction. Distribution factors are calculated based on linear load flows, being used to been used to approximately determine the impact of generation and load on transmission flows. The traditional distribution factors method was extended to AC power flow evaluate the active and reactive power flow [5][6].Other flow-based methods are Bialek, Kirschen and EBE methods [7][8][9][10][11][12]. Bialek, Kirschen methods use the proportional sharing principle [7], [8], which implies that any active power flow leaving a bus, is proportionally with the flows entering the bus. In EBE method, each generator provides a predefined fraction of power to each demand receives a predefined fraction of power and each consumer receives a predefined fraction of power to each generator. The international trend is toward the use of location-based or flow-based methods to allocate and recover at least some portion of transmission costs. In Romania, TSO Transelectrica uses pro rata method.The main objective of this paper is to study and discuss the three methods: Bialek, pro-rata and distribution factors method. A comparison between pro rata, Bialek and distribution factors method, for transmission cost allocated to generators is presented. All methods are applied independently both for real power, based on complete AC power flow. The case study