Abstract:
The U.S. Federal Energy Regulatory Commission (FERC) requires electric utilities to offer six ancillary services. Most of the tariffs filed with FERC price these services on the basis of traditional cost-of-service (embedded) costs, Because most of these services are provided by generating units, however, it should be possible to create competitive markets for them. This paper describes, the structure of, and results from, a spreadsheet model that simulates markets for seven services: losses, regulation, spinning reserve, supplemental reserve, load following, energy imbalance, and voltage support. The model also analyzes, system control, although this service will continue to be provided solely by the system operator under cost-based prices. Developing this computer model demonstrated the likely complexity of markets for energy and ancillary services. This complexity arises because these markets are highly interdependent. For example, the cost of regulation (the frequent change in generator outputs to track the minute-to-minute fluctuations in system load) depends strongly on which units, are already being dispatched to provide energy and losses, their variable costs, and their operating levels relative to their maximum and minimum loading points.

Abstract:
In this paper, within the Italian electricity market, we analyse the features and the dynamics of the imbalance sign, defined as the sign of the algebraic sum of energy bought and sold by the national Transmission and System Operator during the real-time balancing of the electric network. The analyses provide evidence that the probability of having a positive (negative) sign exhibits a serial dependence structure and a dependence on the load periods, as well as on past history. Based on this evidence, we build a suitable model for zonal sign dynamics, and we use it for an out-of-sample forecasting exercise concerning the probability of a positive imbalance sign, πt. The results show that the zonal imbalance sign is 'predictable.' An economic evaluation of the benefits of using the proposed model is also provided. Keywords: Balancing and ancillary services markets, IPEX market, Zonal imbalance sign, Binary data models, Forecasting

Abstract:
Ancillary services are electricity products which include balancing energy, frequency regulation, voltage support, constraint management and reserves. Traditionally they have been procured by system operators from large conventional power plants, as by-products of the production of energy. This paper discusses the use of markets to procure ancillary services in the face of potentially higher demand for them, caused by rising amounts of intermittent renewable generation. We discuss: the nature of markets for ancillary services; what we really mean by ancillary services; how they are impacted by the rise of distributed generation; how they are currently procured; how they relate to the rest of the electricity system; the current state of evidence on ancillary services markets; whether these markets ever be as competitive as conventional wholesale energy markets, and offer some conclusions.