Survey of U.S. Ancillary Services Markets

ANL/ESD-16/1

Survey of U.S. Ancillary Services Markets

Energy Systems Division

This report describes research sponsored by the U.S. Department of Energy, Office of Energy Policy and Systems Analysis.

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ANL/ESD-16/1

Survey of U.S. Ancillary Services Markets

prepared by Zhi Zhou, Todd Levin, and Guenter Conzelmann Center for Energy, Environmental, and Economic Systems Analysis, Energy Systems Division, Argonne National Laboratory January 2016

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Survey of U.S. Ancillary Services Markets

Contents

Notation ....................................................................................................................................................... iv Summary ...................................................................................................................................................... vi 1 Overview................................................................................................................................................. 1

1.1 Ancillary Services Overview............................................................................................................. 1 1.1.1 Regulation and Frequency Response ....................................................................................... 1 1.1.2 Operating Reserve ? Spinning Reserve .................................................................................... 1 1.1.3 Operating Reserve ? Non-spinning Reserve............................................................................. 2 1.1.4 Other Ancillary Services............................................................................................................ 2

1.2 Overview of U.S. Power Markets .................................................................................................... 2 2 CAISO ...................................................................................................................................................... 4

2.1 Overview.......................................................................................................................................... 4 2.2 Regions ............................................................................................................................................ 4 2.3 Ancillary Services ............................................................................................................................. 5

2.3.1 Regulation ................................................................................................................................ 5 2.3.2 Spinning Reserves..................................................................................................................... 6 2.3.3 Non-spinning Reserves ............................................................................................................. 6 2.4 Market Process................................................................................................................................ 6 2.5 Resources ........................................................................................................................................ 7 2.5.1 Data .......................................................................................................................................... 7 2.5.2 Ancillary Services Definition and Market Process .................................................................... 7 3 ERCOT ..................................................................................................................................................... 7 3.1 Overview.......................................................................................................................................... 7 3.2 Regions ............................................................................................................................................ 7 3.3 Ancillary Services ............................................................................................................................. 8 3.3.1 Regulation ................................................................................................................................ 8 3.3.2 Responsive Reserve Service ..................................................................................................... 9 3.3.3 Non-spinning Reserves ............................................................................................................. 9 3.4 Market Process................................................................................................................................ 9 3.5 Resources ...................................................................................................................................... 10 3.5.1 Methodologies for Determining Ancillary Service Requirements.......................................... 10

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3.5.2 Methodology for Implementing ORDC to Calculate Real-Time Reserve Price Adder ............ 10 3.5.3 ERCOT Training Documentation............................................................................................. 10 4 ISO New England .................................................................................................................................. 10 4.1 Overview........................................................................................................................................ 10 4.2 Regions .......................................................................................................................................... 10 4.3 Ancillary Services ........................................................................................................................... 11 4.3.1 Regulation .............................................................................................................................. 11 4.3.2 Ten-Minute Spinning Reserves............................................................................................... 11 4.3.3 Ten-Minute Non-spinning Reserves ....................................................................................... 11 4.3.4 Thirty-Minute Operating Reserves ......................................................................................... 12 4.4 Market Process.............................................................................................................................. 12 4.5 Resources ...................................................................................................................................... 12 4.5.1 Overview of ISO New England's Wholesale Electricity Markets and Market Oversight ........ 12 4.5.2 ISO New England Operating Procedure No. 8: Operating Reserve and Regulation............... 12 5 MISO ..................................................................................................................................................... 12 5.1 Overview........................................................................................................................................ 12 5.2 Regions .......................................................................................................................................... 13 5.3 Ancillary Services ........................................................................................................................... 13 5.3.1 Regulation Reserves ............................................................................................................... 14 5.3.2 Spinning Reserves................................................................................................................... 14 5.3.3 Supplemental Reserves .......................................................................................................... 14 5.4 Market Process.............................................................................................................................. 14 5.5 Resources ...................................................................................................................................... 15 5.5.1 Ancillary Services Definition and Market Process .................................................................. 15 6 NYSIO .................................................................................................................................................... 15 6.1 Overview........................................................................................................................................ 15 6.2 Regions .......................................................................................................................................... 15 6.3 Ancillary Services ........................................................................................................................... 16 6.3.1 Regulation .............................................................................................................................. 16 6.3.2 Ten-minute Spinning Reserves ............................................................................................... 16 6.3.3 Ten-minute Non-synchronized Reserves ............................................................................... 17 6.3.4 Thirty-minute Spinning Reserve ............................................................................................. 17

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6.3.5 Thirty-minute Non-synchronized Reserves ............................................................................ 17 6.4 Market Process.............................................................................................................................. 17 6.5 Resources ...................................................................................................................................... 18

6.5.1 Data ........................................................................................................................................ 18 6.5.2 Ancillary Services Definition and Market Process .................................................................. 18 7 PJM ....................................................................................................................................................... 18 7.1 Overview........................................................................................................................................ 18 7.2 Regions .......................................................................................................................................... 18 7.3 Ancillary Services ........................................................................................................................... 19 7.3.1 Regulation .............................................................................................................................. 19 7.3.2 Synchronized Reserves ........................................................................................................... 20 7.3.3 Primary Reserves .................................................................................................................... 20 7.4 Market Process.............................................................................................................................. 20 7.5 Resources ...................................................................................................................................... 20 7.5.1 Data ........................................................................................................................................ 20 7.5.2 Ancillary Services Definition and Market Process .................................................................. 21 8 SPP ........................................................................................................................................................ 21 8.1 Overview........................................................................................................................................ 21 8.2 Regions .......................................................................................................................................... 21 8.3 Ancillary Services ........................................................................................................................... 22 8.4 Market Process.............................................................................................................................. 23 9 Comparative Analysis ........................................................................................................................... 24 9.1 Regulation Reserves Market Data ................................................................................................. 24 9.2 Spinning Reserves Market Data .................................................................................................... 27 9.3 Non-Spinning Reserves Market Data ............................................................................................ 30 9.4 Annual Data Summaries ................................................................................................................ 33

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Survey of U.S. Ancillary Services Markets

Notation

ACE AGC ASMP

BAAL

CAISO CPS

DAM

EMS ERCOT

FERC

HAM

ISO ISO-NE

LMP

MAD MCP MISO

NERC NRR NYISO

ORDC

QSE

RIPS RMCP RMCCP RMPCP

Area Control Error automatic generation control ancillary service marginal price

Balance Authority ACE Limit

California Independent System Operator Control Performance Standard

Day Ahead Market

Energy Management System Electric Reliability Council of Texas

Federal Energy Regulatory Commission

Hour Ahead Market

Independent System Operator ISO New England

Locational Marginal Price

Mid-Atlantic Dominion Market Clearing Price Midcontinent ISO

North American Electric Reliability Council Normal Response Rate New York ISO

Operating Reserve Demand Curve

Qualified Scheduling Entity

regulation interval performance score regulation market clearing price regulation market capability clearing price regulation market performance clearing price

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