Abstract: Efficient and accurate market settlement mechanism contributes to balancing interests between market members, and ensuring stable and orderly development in electricity market. In order to reflect the spot market mechanism in inter-provincial unified balance area, this paper conducts an investigation on trade settlement mechanism in inter-provincial unified balance area. This paper establishes a two-settlement mechanism from the perspective of the relationship between market entities. The mechanism is comprised of two layers, with market entity settlement on generation and demand sides as bottom layer and with intra-area inter-provincial settlement as top layer. Market entity settlement on generation and demand sides is applied between provincial generation enterprises and power consumers, while intra-area inter-provincial settlement is utilized to balance settlement among intra-area entities as well as settlement of inter-area electricity settlement. The settlement results based on simulated data indicates that the proposed settlement mechanism is theoretically reliable and practically applicable.