Quantitative analysis of wind financial transmission rights using proforma model

Sandeep Nimmagadda, Mark A. Harral, Stephen B. Bayne

Research output: Contribution to journalArticlepeer-review

1 Scopus citations


Financial transmission right (FTR) is a financial tool used to hedge the congestion component of the locational marginal price (LMP) across two different nodes in a transmission system. FTR is usually purchased by a firm transmission customer, and is a financial equivalent of the physical power delivered across the two nodes. In the case of wind farms (WFs), the generator might not produce energy when the price difference due to congestion exists. This concept of FTR which is primarily designed for conventional generation and loads might expose the WFs to a negative cash flow which is a potential issue with the intermittent generations such as wind [1]. In this paper, the drawbacks of the existing FTRs are discussed and wind FTRs are proposed to overcome the drawbacks. A quantitative analysis has been performed using proforma models to compare the existing FTRs to the proposed wind FTRs. Sensitivity of various factors influencing the FTR investment for a wind project is analyzed.

Original languageEnglish
Pages (from-to)10-19
Number of pages10
JournalInternational Journal of Power and Energy Systems
Issue number1
StatePublished - 2014


  • Financial transmission rights
  • Firm transmission service
  • Locational marginal pricing
  • Wind financial transmission rights


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