The paper discusses the major planning issues pertaining to economic operation of power systems in India viz. integrated operation of the State Electricity Boards (SEBs) through formation of the National Grid, optimal sharing of central sector generation by the SEBs, time-of-day pricing policy for power trading among the SEBs optimal expansion of National Grid and streamlining the coal production and transportation for optimal System operation. A multi-area linear programming (LP) model, NATGRID, is developed to quantify the benefits from National Grid operation, suggest optimal sharing norms for central sector generation and formulate time-of-day pricing scheme for interutility power trading. Four interregional transmission projects are identified by exploiting the duals of the LP problem, for expansion of National Grid. The bottlenecks in coal production and transportation systems are indicated and the system cost savings from removing them are quantified. The analysis aims at encouraging and motivating the utilities to accept the idea of co-operation and making investment more cost-effective.
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Parikh et al. (1996) studied this question.
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