Applications of network control devices such as phase shifting transformers and flexible AC transmission system (FACTS) devices in power systems include congestion management and parallel flow reduction. In a market environment, it is common for these devices to be primarily operated for local congestion relief. However, this single objective control may not utilize the controller to its maximum extent. It may be possible for the device to both manage congestion and reduce parallel flow. This paper develops a two-level hierarchical multiobjective optimization method that determines the operating points of an area's network control devices for local congestion management and inter-area parallel flow reduction, as measured by a novel wide-area impact index. This index is comprised of the weighted sum of the changes in line flow over a large number of transmission lines caused by the operation of an adjacent area. The method and index are validated through an application to a 30-bus test system
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