EBF 483
Introduction to Electricity Markets

9.1 Ancillary Services Markets


9.1 Ancillary Services Markets

Since electricity cannot be stored in large volumes at a reasonable cost, part of the job of the power grid operator is to make sure that supply and demand balance at every moment. This means that the power grid is making adjustments every single second as demand changes (actually, much more quickly than one second). Many of these adjustments are automated responses. Go ahead and turn the light on and off in the room you're sitting in. Believe it or not, there is a huge network of sensors on the power grid that can tell that electricity usage is going up and down by some small amount, and making automatic adjustments to power plant outputs in response.

If grid operators can tell that electricity demand is about to increase in, say, five minutes or 30 minutes, then they can manually issue instructions to power plants. The video (4:30) below provides a cute example of this:

1,500,000 Kettles (4:30)
Click here for a transcript of the video.

SPEAKER 1: At the National Grid Control Center, national balancing engineer Simon Jeffcoat's on duty. Arrayed on the wall in front of him is his view of Britain from above. The country's been tipped on its side. And every high-powered electricity connection from the far north of Scotland to Cornwall has been mapped out in loving detail.


But Simon is bracing himself for the most difficult moment of his day by watching Eastenders. When the credits start to roll, he's going to have to deal with a massive surge in electrical demand-- what's known as a TV pickup.

SIMON JEFFCOATS: We're expecting a pickup of around about three gigawatts, which is 3,000 million watts or equivalent to 1 and 1/2 to 1 and 3/4 million kettles going on. So we expect the demand to pick up over a period of about five minutes.

SPEAKER 1: Power surges like this are unique to Britain. No other country in the world switches on so many kettles in so short a time. To cope with the strain, Simon has had to put specialized power stations on standby as far away as Snowdonia and Scotland.

These hydroelectric plants can set thousands of tons of water plunging down the hillside at a moment's notice, generating huge bursts of power in a matter of seconds. But Simon is also having to ask our neighbors across the channel for a favor.

SIMON JEFFCOATS: For assistance with the end of Eastenders, we have the French link picking up. And they are picking up 600 megawatts at 100 megawatts a minute. So that's, again, a very rapid response.

SPEAKER 1: Simon is slave to this flickering frequency indicator, which he has to keep as close as possible to 50 hertz. If there's not enough power in the national grid, it drops off the scale. Too much and it shoots off the other side. And he has to judge his timing perfectly even if the BBC isn't quite working to schedule.

SIMON JEFFCOATS: We would be notified a time for the end of the program. And it hasn't actually finished at that time.

SPEAKER 1: Which means?


Simon fires off instructions for his keyboard. On the other side of the country, vast turbines rumble into life.

SIMON JEFFCOATS: Dinorwig. He's up to 150. I've just instructed him up to 300 megawatts now [INAUDIBLE] is up to 90 megawatts, its full output. French [INAUDIBLE] now.

SPEAKER 1: Two minutes into the TV pickup, and it looks like there's going to be more than enough power to go round. And then suddenly, there's a problem.


SPEAKER 2: [INAUDIBLE] allocation.

SIMON JEFFCOATS: Oh, is it a French thing?

SPEAKER 2: Yeah.

SPEAKER 1: There's a trip on the additional supply from France. The frequency has dropped dramatically. Simon has just moments to cover the sudden shortfall. He rapidly sends out instructions to get one more hydroelectric plant online. Then once more, the supply heads back into the safe zone.

SIMON JEFFCOATS: It was immediate decision. As soon as the frequency dropped through 49.8, I had to react.

SPEAKER 1: The delicate balance of our electricity supply has been restored for now. Across the country, a million kettles keep on boiling.

Credit: Britan From Above Documentary, Youtube. August 2008.

Ensuring that the power grid is stable and that supply matches demand on a continuous basis requires that decisions be made over a staggering array of time scales, as shown in the figure below. The day ahead market is used to allow power grid operators to have enough supply to meet anticipated demand 24 hours in advance. The real time market does the same thing on an hour-ahead time frame. But what happens between the hour-ahead market clearing and actual real-time dispatch?

Enter image and alt text here. No sizes!
Figure 9.1: Operational and planning decisions for electric power systems
Click Here for a text description of the image
Text description of Figure 9.1
Power System Time Scale
High-frequency switching devices 10^-6 to 10^-4
Synchro-phasors 10^-4 to 10^-3
Protective Relay Operation 10^-3 to 10^-2
One a.c. cycle 10^-2
Dynamic System Response (stability) 10^-2 to 10^0
AGC signal 10^1
Wind and solar output variation 10^0 to 10^2
Demand response? 10^1 to 10^3
Hour-ahead scheduling 10^3
Resolution of most renewable integration models 10^3
service restoration (outages) 10^4
Day ahead scheduling 10^5
T&D planning 10^8
Planning for carbon emission goals 10^9
Source: Alexandria von Meier

As the figure shows, there is a lot going on between one hour ahead of real-time and fractions of a second ahead of real-time. If the grid operator feels that more power is needed one day or one hour before real-time, it can increase the amount cleared through the day ahead or real-time markets. But what if the grid operator needs additional supply in fifteen minutes? In five minutes? In five seconds?

The first part of this lesson is focused on "ancillary services" - those tools that grid operators have to handle fluctuations in supply and demand in between those discrete moments when the real-time market clears.

There are four primary types of ancillary services that we'll discuss in this lesson:

  • Reactive Power
  • Frequency regulation
  • Spinning and Non-Spinning Reserves
  • Black Start

You can read more technical details about each of these in the ancillary services primer posted on Canvas.