This paper addresses a modified dynamical model to analysis of load-frequency control (LFC) in a bilateral-based restructured power system. In a new environment, vertically integrated utilities no longer exist, however the common objectives, i.e. restoring the frequency and the net interchanges to their desired values for each control area are remained. It is assumed that each distribution company (Disco) is responsible for tracking its own load and honoring tie-line power exchange contracts with its neighbors by securing as much transmission and generation capacity as needed. Therefore the overall power system structure can be considered as a collection of distribution areas as separate control areas interconnected through high voltage transmission lines or tie-lines. A three control areas power system example with possible contract scenarios and load changes is given to illustrate the generalized model.
