Market Monitoring and Leader Follower Incentive Control of Ancillary Services

In this paper the problems of market monitoring and control of ancillary services of a future energy systems are presented. We envision that future system operation of electric power systems will evolve into completely unbundled ancillary service markets that are governed by spot price signals. The grid operators need to acquire ancillary services through competitive markets for control of the system operation. With the above vision of the future, this paper presents the control of ancillary services based on a frequency regulation/load following (LFC) market, a load regulating market (RL), and a base load (BL) market. In the LFC market, the units dispatched for generation must have specific response characteristics as determined by the nature of system loads. These units will be controlled by the grid operator. It is envisioned that LFC will be multi-time scale and decentralized. In the regulating market (RL), the units dispatched for generation will not participate in LFC. These units are dispatched for specific period of time for regulating system load. The base load (BL) units are dispatched daily to satisfy the base load of the day on a weekly or monthly basis. The locational market power associated with generators participating in LFC and in RL is even more critical than that for generators participating in satisfying the base load, since these units are required for frequency regulation, voltage support and relief of overload conditions. To create an efficient market for these services, we will propose and formulate the use of incentive leader-follower strategies for the BL,RL and the LFC markets.