The Application of Linear Programming to the Determination of Transmission Fees in an Electrical Power Network

This article demonstrates how the transportation method of linear programming was used to solve a practical accounting problem in the electrical power industry of Norway, namely, the determination of transmission costs as a function of the product of megawatts times the distance in kilometers for each subscriber in the electrical network. It a subscriber has several points where power is fed into the system or taken out of the system, contract requirements specify that he shall pay for a transmission configuration which gives the lowest sum of the transmission quantities. The transportation algorithm is used to solve this minimization problem.