Design of competitive markets for spinning reserve services

Abstract

Spinning reserve maybe provided as an ancillary service by the Independent System Operator in a deregulated market. This paper presents the design of a spinning reserve service (SRS) market that can act as an effective tool to determine spinning reserve schedules in deregulated power systems. The present method obtains uniform spinning reserve price within a bid-based market structure considering market constraints, transmission constraints and reserve requirements. The participants in this market are assumed to provide bid prices and corresponding amount of spinning capacity available for this service. A distinguishing feature of this market is that it works on a short-term basis (one hour ahead) and is independent of the real power market. We also incorporate a reserve-dependent bidding strategy for participant generators and demonstrate that the market for this service will be highly volatile to system conditions.