In order to analyze the impact of demand response(DR)to available transfer capability(ATC)in power system

a calculation method of ATC in the open electricity market is proposed. Taking the typical demand response resource the interruptible load as the research object

a bi-level optimization model considering the different interests of load serving entity(LSE)and independent system operator(ISO)is developed: the upper level of the proposed model chooses the users participating in the DR by minimizing the cost of LSE; the lower level determines the local marginal price(LMP)and generation economic dispatch by minimizing the total generation bidding. The active power distributed according to DR and generation bidding is taken as the ground state. Based on this

the ATC between areas is calculated. The bi-level optimization problem is first converted to mathematical programming problems with equilibrium constraints(MPEC)by using the KKT conditions of the lower level of the proposed model. Then

the nonlinear terms of the constraints are eliminated according to the strong duality theory. Thus the original model is transformed into a mixed-integer linear programming(MILP)model. Finally

the simplified mathematical model is solved by CPLEX in GAMS. The feasibility and effectiveness of the proposed method are verified through the simulation of PJM-5-bus

IEEE 30-bus

IEEE 118-bus and IEEE 300-bus systems

as is the necessity of DR inclusion in the calculation of ATC.