I. Introduction
In Taipower, the transmission system is to deliver the power generated in power plants to distribution substations and to serve large industrial customers with 161KV/69KV voltage levels at the same time. The main transformers of distribution substations are applied to step down the voltage level to 22KV/IIKV of distribution feeder to serve the medium industrial and large commercial customers. The low voltage customers of residential and commercial customers are served by distribution transformers along the primary distribution feeders. Although different types of protection devices have been installed in the transmission network to detect and isolate the faulted area, large scale system outages still occur due to the malfunction of protection system in Taipower. To improve the customer service quality, the reliability of various types of protective relays has to be investigated. By integrating the investment cost of protective relays and the corresponding service interruption cost of customers due to malfunction of protective system, the optimal planning of protective relays for transmission lines can be achieved.