1) Due to interconnection it is possible of wheeling of electricity instantly.
2) The reliability and continuity of the supply is improved with interconnected grid system. With fault condition occurring in any one generating station, the supply can be maintained with the help of other generating stations.
3) Inter connected power systems reduce the overall requirement of installed capacity to fulfills the peak demand.
4) With interconnected grid system the economical operation of the plant is possible. e.g. a. To run power plant for the maximum time whose operating cost is minimum. b. Plants with higher operating cost are only loaded (started) when required (during peak hours) c. And those with maximum operating cost are kept in reserve and would operate only in case of emergency. Due to this flexibility power can be supplied with minimum cost/unit.
5) With interconnected grid system, It is possible to arranged the total load in such a way that a. More efficient plants can be used as base load stations which can work continuously throughout the year at high load factor. b. The less efficient plants can be made to operate as peak load plants.
6) With interconnected grid system, it is possible to use older and inefficient plants can be effectively used.
7) Due to interconnection generating unit of higher capacity (500MW & above) can be installed & operate economical
8) In combine operation of several plants the reserve capacity required to each individual power plant is reduced or not required also, so it reduces initial as well as operating cost of plant.
9) The load factor, diversity factor, power factor & efficiency of operation are improved.
10) Better utilization of hydro power due to combined operation with thermal power plant.
11) Isolated power systems have higher frequency fluctuations with change in load. With inter connections, the system becomes stronger & the effect of load variation is reduced.
12) Due to interconnection it is easy for planning, co-ordination, supervision & control over complete transmission system is possible.
13) To supply power in most economic manner is possible.
14) Due to interconnection, there is optimum utilization of available natural recourses in the country is possible.