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This paper presents a novel approach, Equal Incremental fuel cost (λ-Concept) approach, for solving Multi Area Economic Dispatch (MAED) problem. It is a simple approach and developed from the basic observation of incremental fuel cost of an area. The proposed approach has been tested on 4-area system with four generators in each area and a large 2-area system consists of 120 generators. The suggested algorithm has been tested extensively by considering the different tie line power transferdoi:10.37917/ijeee.13.1.2 fatcat:hk3vcieqirh2vcp6h5v5wuyyge