How detailed value of lost load data impact power system reliability decisions: a trade-off between efficiency and equity

The value of lost load (VOLL) is an essential parameter for transmission system reliability management. It represents the cost of unserved energy of electricity interruptions. Various empirical studies have estimated this parameter for different countries and more recently, for different interruption characteristics - such as interruption duration, time of interruption and interrupted consumer. However, most applications only use one constant VOLL. Our theoretical analysis shows that using more-detailed VOLL data allows to make better-informed transmission reliability decisions. To illustrate this, we estimate the efficiency gains of including consumer and time characteristics in short-term transmission reliability management using VOLL data from Norway, Great Britain and the United States. Depending on the VOLL data and the method of demand curtailment, our five-node network indicates efficiency gains up to 43%. However, increased efficiency leads to decreased equity. Striking the balance between these opposing objectives is crucial for social acceptance.