US power markets switch to nodal trading

Several North American power market system operators have switched to a nodal system in recent years in search of greater market transparency, more granular and accurate pricing and the ability to manage congestion more precisely. Pauline McCallion looks at current progress

Generating a more accurate price signal for electricity prices tends to be seen as the major benefit of transitioning US power markets to a nodal structure. Compared to zonal markets, prices can be calculated at a more granular level under a nodal structure. When it comes to resource allocation, a more precise indication of demand will ensure new transmission lines or generating facilities are added as and when they are needed.

"Nodal power markets are very important for providing the accurate