Electrical power system simulation involves power system modeling and network simulation in order to analyze electrical power systems using design/offline or real-time data. Power system simulation software's are a class of computer simulation programs that focus on the operation of electrical power systems. These types of computer programs are used in a wide range of planning and operational situations for electric power systems.

Applications of power system simulation include: long-term generation and transmission expansion planning, short-term operational simulations, and market analysis (e.g. price forecasting). These programs typically make use of mathematical optimization techniques such linear programming, quadratic programming, and mixed integer programming.

Multiple elements of a power system can be modelled. A power-flow study calculates the loading on transmission lines and the power necessary to be generated at generating stations, given the required loads to be served. A short circuit study or fault analysis calculates the short-circuit current that would flow at various points of interest in the system under study, for short-circuits between phases or from energized wires to ground. A coordination study allows selection and setting of protective relays and fuses to rapidly clear a short-circuit fault while minimizing effects on the rest of the power system. Transient or dynamic stability studies show the effect of events such as sudden load changes, short-circuits, or accidental disconnection of load on the synchronization of the generators in the system. Harmonic or power quality studies show the effect of non-linear loads such as lighting on the waveform of the power system, and allow recommendations to be made to mitigate severe distortion. An optimal power-flow study establishes the best combination of generating plant output to meet a given load requirement, so as to minimize production cost while maintaining desired stability and reliability; such models may be updated in near-real-time to allow guidance to system operators on the lowest-cost way to achieve economic dispatch.

There are many power simulation software packages in commercial and non-commercial forms that range from utility-scale software to study tools.

The load-flow calculation is the most common network analysis tool for examining the undisturbed and disturbed network within the scope of operational and strategic planning.

Using network topology, transmission line parameters, transformer parameters, generator location and limits, and load location and compensation, the load-flow calculation can provide voltage magnitudes and angles for all nodes and loading of network components, such as cables and transformers. With this information, compliance to operating limitations such as those stipulated by voltage ranges and maximum loads, can be examined. This is, for example, important for determining the transmission capacity of underground cables, where the influence of cable bundling on the load capability of each cable has to be taken also into account.

Due to the ability to determine losses and reactive-power allocation, load-flow calculation also supports the planning engineer in the investigation of the most economical operation mode of the network.

When changing over from single and/or multi-phase infeed low-voltage meshed networks to isolated networks, load-flow calculation is essential for operational and economical reasons. Load-flow calculation is also the basis of all further network studies, such as motor start-up or investigation of scheduled or unscheduled outages of equipment within the outage simulation.