Hi Mathew,
My understanding, mostly glend through developing Nempy, is:
1. Losses are effectively added as additional load in the two
connected regions, with losses split according to the loss share
factors, see the table INTERCONNECTORCONSTRAINT. So the flow into and
out of each region is just MFLOW.
2. Losses can be negative because AEMO models losses as a quadratic
function fit to historical empirical loss data, sometimes the best fit
of the function to the data gives small negative values when the flow
is small. See this doc for more details:
https://github.com/UNSW-CEEM/nempy/blob/master/docs/pdfs/Marginal%20Loss%20Factors%20for%20the%202020-21%20Financial%20year.pdf,
section 4. In this case, yes, the losses would appear as additional
generation in the connected regions, free energy!!!!
3. This example from nempy might be helpful:
https://nempy.readthedocs.io/en/latest/examples.html#interconnector-with-losses
4. Even deeper dive it how losses are modelled (assuming nempy gets it right):
https://nempy.readthedocs.io/en/latest/markets.html#nempy.markets.SpotMarket.set_interconnector_losses
Cheers,
Nick
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