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What are pricing nodes, load zones and the hub?

April 26, 2017Hub load nodes pricing zones

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What are pricing nodes, load zones and the hub?

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Several categories of locations are defined in SMD: nodes, load zones and a hub. Nodes are points where power is injected or withdrawn from the system. Zones are aggregations of nodes. The hub is a special aggregation of fairly unconstrained nodes, designed to facilitate trading. Prices at the hub should not be affected significantly by congestion. Generation will be priced nodally, while load (demand) will pay a uniform price for its zone. Load zones generally follow the political boundaries of the six New England states, except Massachusetts, which is sub-divided into three zones—Western/Central Massachusetts, Northeastern Massachusetts (which includes Boston) and Southeastern Massachusetts. The price at each zone is the megawatt-weighted average of all nodal prices within the zone. Thus, relatively high locational prices at one node are averaged together with all other nodal prices within the zone to yield a single price for load.