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Locational marginal price (LMP) — Energy Glossary | Pilot Energy

Written by Pilot Energy | May 26, 2026 4:21:54 PM

Locational marginal price (LMP)

Category: Markets

The cost of supplying the next megawatt-hour of electricity at a specific node on the grid. Comprises three components: energy (system-wide marginal cost), congestion (cost of transmission constraints), and losses (cost of electrical losses). Published every 5 minutes in real-time markets.

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