Probabilistic Security-Constrained Unit Commitment with Generation and Transmission Contingencies

System operators maintain sufficient reserve in power systems in order to respond to generation and transmission contingencies. Traditionally, the reserve requirements have been determined using deterministic criteria (e.g., $N - 1$). These amounts of reserve allocate sufficient spare generation capacity and transmission margins to protect the system against any contingency of magnitude lower or equal to the chosen criterion. However, these criteria ignore the probability of individual contingencies as well as energy redistribution and transmission limitations in post-contingency states. In this paper, we propose to optimize the amount, location, and chronological procurement of the reserve in a given power system using probabilistic criteria. The proposed approach factors the probability of individual contingencies in a cost/benefit analysis, which balances the pre-contingency operating costs against the post-contingency cost of interruptions. The effectiveness of the proposed approach is demonstrated using a modified IEEE Reliability Test System.