Transmission pricing and congestion management are two important aspects of modern power sectors working under a deregulated environment or moving towards a deregulated system (open access) from a regulated environment. The transformation of power sector for open access environment with the participation of private sector and potential power suppliers under the regime of trading electricity as a commodity is aimed at overcoming some of the limitations faced by the vertically integrated system. It is believed that this transformation will bring in new technologies, efficient and alternative sources of power which are greener, self sustainable and competitive. There is ever increasing demand for electrical power due to the changing life style of human beings fueled by modernization and growth. Augmentation of existing capacity, siting of new power plants, and a search for alternate viable sources of energy that have lesser impact on environment are being taken up. With the integration of power plants into the grid depending upon the type, loca- tion and technology used, the cost of energy production also differs. In interconnected networks, power can flow from one point to other point in infinite number of possible paths which is decided by the circuit parameters, operating conditions, topology of network and the connected loads. The transmission facility provided for power transfer has to recover the charges from the entities present in the network based on the extent of utilization. Since power transmission losses account for nearly 4 to 8% of the total generation, this has to be accounted for and shared properly among the entities depending upon the connected generation/load. In this context, this thesis aims to evaluate the shortcomings of existing tracing methods and proposes a tracing method based upon the actual operating conditions of the network taking into account the network parameters, voltage gradient among the connected buses and topology of the network as obtained by the online state estimator/load flow studies. The concept proposed is relatively simple and easy to implement in a given transactional period. The proposed method is compared against one of the existing tracing technique available in literature. Both active and reactive power tracing is handled at one go. The summation of partial contributions from all the sources in any given line of the system always matches with that of the respective base case ow. The AC power flow equations themselves are nonlinear in nature. Since the sum of respective partial flows in a given branch is always equal to the original ow, these are termed as virtual flows and the effect of nonlinearity is still unknown. The virtual flows in a given line are complex in nature and their complex sum is equal to the original complex power flows as in the base case. It is required to determine whether these are the true partial flows. To answer this, a DC equivalent of the original AC network is proposed and is called as the R - P equivalent model. This model consists of only the resistances as that of original network (the resistances of transformers and lines neglecting the series reactance and the shunt charging) only. The real power injections in a AC network i.e. sources into respective buses and loads (negative real power injections) are taken as injection measurements of this R P model and the bus voltages (purely real quantities) are estimated using the method of least squares. Complex quantities are absent in this model and only real terms which are either sums or differences are present. For this model, virtual flows are evaluated and it has been verified that the virtual real power contributions from sources are in near agreement with the original AC network. This implies that the virtual flows determined for the original network can be applied for day-to-day applications. An important feature of the virtual flows is that it is possible to identify counter ow components. Counter flow components are the transactions taking place in opposite direction to the net flow in that branch. If a particular source is produces counter flow in a given line, then it is in effect reducing congestion to that extent. This information is lacking in most of the existing techniques. Counter flows are useful in managing congestion. HVDC links are integrated with HVAC systems in order to transfer bulk power and for the additional advantages they offer. The incremental cost of a DC link is zero due to the closed loop control techniques implemented to maintain constant power transfer (excluding constant voltage or constant current control). Consequently, cost allocation to HVDC is still a problem. The proposed virtual power flow tracing method is extended to HVAC systems integrated with HVDC in order to determine the extent of utilization of a given link by the sources. Before evaluating the virtual contributions to the HVDC links, the steady state operating condition of the combined system is obtained by per-forming a sequential load flow. Congestion is one of the main aspects of a deregulated system, and is a result of several transactions taking place simultaneously through a given transmission facility. If congestion is managed by providing pricing signals for the transmission usage by the parties involved. It can also be due to the non-availability of transmission paths due to line outages as a result of contingencies. In such a case, generation active power redispatch is considered as a viable option in addition to other available controls such as phase shifters and UPFCs to streamline the transactions within the available corridors. The virtual power flow tracing technique proposed in the thesis is used as a guiding factor for managing congestions occurring due to transactions/contingencies to the possible extent. The utilization of a given line by the sources present in the network in terms of real power flow is thus obtained. These line utilization factors are called as T-coefficients and these are approximately constant for moderate increments in active power change from the sources. A simple fuzzy logic based decision system is proposed in order to obtain active power rescheduling from the sources for managing network congestions. In order to enhance the system stability after rescheduling, reactive power optimization has life systems to illustrate the proposed approaches. For secure operation of the network, the ideal proportion of active power schedule from the sources present in the network for a given load pattern is found from network [FLG] matrix. The elements of this matrix are used in the computation of static voltage stability index (L-index). This [FLG] matrix is obtained from the partitioned network YBUS matrix and gives the Relative Electrical Distance (RED) of each of the loads with respect to the sources present in the network. From this RED, the ideal proportion of real power to be drawn by a given load from different sources can be determined. This proportion of active power scheduling from sources is termed as Desired Proportion of Generation (DPG). If the generations are scheduled accordingly, the network operates with less angular separation among system buses (improved angular stability), improved voltage profiles and better voltage stability. Further, the partitioned K[GL] matrix reveals information about the relative proportion in which the loads should draw active power from the sources as per DPG which is irrespective of the present scheduling. Other partitioned [Y ′ GG] matrix is useful in finding the deviation of the present active power output from the sources with respect to the ideal schedule. Many regional power systems are interconnected to form large integrated grids for both technical and economic benefits. In such situations, Generation Expansion Planning (GEP) has to be undertaken along with augmentation of existing transmission facilities. Generation expansion at certain locations need new transmission networks which involves serious problems such as getting right-of-way and environmental clearance. An approach to find suitable generation expansion locations in different zones with least requirements of transmission network expansion has been attempted using the concept of RED. For the anticipated load growth, the capacity and siting generation facilities are identified on zonal basis. Using sample systems and real life systems, the validity of the proposed approach is demonstrated using performance criteria such as voltage stability, effect on line MVA loadings and real power losses.