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It is worth emphasizing that the determination of such a rational combination is not an easy task and its performance is country-specific because of specific features of economy and electric power industry, conditions of their operation and development.

Moreover, by the late 1990s, the backup generating capacities had started to decrease considerably in many countries, since it turned out to be unprofitable for the generating companies to maintain extra capacities.

This transformation is characteristic of all the countries experiencing energy liberalization and deregulation.

The formation of a new methodology has only started.

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The principles and methods for expansion planning in electric power industry in the market environment [1-6] are being developed with due consideration of general methodological developments [7-10].

Certain problems and methods of generation [1,6,11-13] and electrical network [6,14-16] expansion planning in the market environment are being studied with particular attention paid to game approaches [1,11,14].

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This approach was mainly based on the theoretical conclusions of the classical school of economics that the market balance is achieved owing to the law of demand and supply by means of flexible market pricing under the conditions of perfect competition; prices reflect individual preferences and fluctuations according to the changes in demand and supply; resources are distributed according to the relative price level in the market, and if this level depends on fluctuations in demand and supply, the absolute price level is determined by the amount of money; when the balance is disturbed, the system strives to restore it, that is why any attempts to interfere in the operation of market mechanisms can only aggravate the situation.The market approaches in generation and transmission networks are presented.The main principles of the holistic power system expansion planning are given.In Russia, such ideas were especially popular in the early and mid-1990s.A failure to recognize the significance of the problems of electric power industry development in the economically developed countries was explained by the fact that the intensive energy saving virtually stopped electricity consumption growth; at the same time large backups were formed at generating facilities and in the electric network; as a result, the problems of power shortage and electric network constraints did not manifest themselves for a long time, and surplus power made it possible to create competitive electricity markets.

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