The role of the ISO in deregulated energy marketsEnergy Trading & Risk Management Systems Group @ linkedin

The role of the ISO in deregulated energy marketsEnergy Trading & Risk Management Systems Group @ linkedin

This ppt represents the first delivery of a collection of presentations that will bedelivered by the Energy Trading & Risk Management Systems Group members @tlinkedinlinkedin.

Would you wish to participate (extending the current presentation, delivering apresentation, providing with feedback) do not hesitate to contact with any of theETRM Group managers.

Any Energy Trading & Risk Management Systems Group member is kindly invited todisclose the ETRM Systems Group source when using partially or totally thispresentation.

The role of the ISO in deregulated energy marketsVersion I. January 2012.

ISO

MORegulatory 

Electricity markets

Deregulated 

MOg ybodyThe only possible way to fully

understand an integrated ETRMframework is understanding allthe complexities around electricity 

marketsGENCOEligible 

customer

the complexities around.

Would it be possible tod d h GENCO

DISCOSupplier

understand how a GENCOoperates without understandinghow ISO’s operate ?

The Energy Trading & Risk Management Systems Group has an initiative focused todeliver an integrated vision of ETRM systems including understanding the processesdeliver an integrated vision of ETRM systems, including understanding the processesinvolved in power, gas, oil …

ISO –Independent System OperatorR li bili id i i i i d i d d d di i i i

G id l i

Reliability considering economic criteria under independence and non discriminationbasis

Grid planning

Outage management

Load TSO

Demand response

forecastingTSO 

coordination

Reliability

ISO

MeteringVoltage control IndependenceEfficiency

SettlementFrequency control

Non discriminationUnbundlling

BillingCongestion pricing

discriminationg

Informationmanagement

Black start market 

Ancillary Services

ISO –Independent System Operatorp y pCentralized versus non centralized approaches

In a pure decentralized scheme, the market agents agree on deliveries by means of bilateral contracts at aprice fixed by them. The ISO must accept those arrangements unless they are technically unfeasible. The ISOruns ancillary services, purchasing the service at a “market price” offered by the market agents. Participation ofancillary services is not mandatory.

The market agents might trade also in a Power Exchange in which bids and offers are matched by means of anauctioning process. This is a blind market, and some level of “centralized optimization” is incorporated in thesense that only the most economical offers are matched. In some places participation in this market ismandatory, while in others it is not. Nevertheless, market players still can define the price at which they wantto bid, so they can effectively “uncouple” generation costs with the bidding stacks, that are based on, y y p g g ,maximization of generator’s benefits. There is not possibility to make a final (global) generation schedule basedon real generation costs. This is still a decentralized scheme

In an hybrid model, the generators might arrange bilateral contracts and match bids in auctioning processes iny , g g g g p“blind” power exchange markets (decentralized approaches), but the spare available energy must be offered toancillary services under a mandatory framework (centralized approach). Generation schedules will be arrangedby the ISO under a cost‐based approach based on optimal power flow analysis (this is, the generator does notsend “bids”, but generation “costs”). Ancillary services might be paid at a “Local Marginal Price”.

In a pure centralized model, the generators just send costs associated to generator. The ISO arranges schedulesbased on the optimization of the global generation. Generators are rewarded at their generation cost, althougha prime can be added to the costs. This is a case of regulated environments.

ISO –Independent System Operatorp y pEfficiency …. A long way to go ….

An “efficient scheme” should produce appropriateeconomical signals for efficient investing in transmissionresources and in efficient location of new generation andloads.

Zonal aggregation

Nodal

of efficiency

Ideally, the framework should be simple to implementand transparent .

ISO’s grid planning responsibilities should be enforced to

Zonal

L l f l it

Level o

g p g pgain efficiency (centralized model) or to assure a certainlevel of sustainability (decentralized model).

Level of complexityCentralized approaches enable nodal pricing under acost based approach 

Rules and regulation should be carefully designed in order to avoid collusion of prices and to discourage inefficientallocation of generation assets and loads. Apparently, deregulation of markets and implementation of decentralizedframeworks have led to importing from other kind of industries of “pure market models” , which have proven not towork appropiately in the electricity sector. Social welfare demands a re‐definition of deregulated electricitymodels !

Albert Einstein: everything should be made as simple as possible, but not simpler

models !Clear governance mechanisms for the ISO are fundamental for a proper functioning of the deregulated framework.

y g p p p

ISO –Independent System Operatorp y pThe figure of the MO

In decentralized models, the idea is to enable an independent marketplace in which the market agents can tradeenergy by means of bilateral contracts or auctioning processes in a “power pool”. The market agents look for “benefitmaximization”. As long as those matched bids between buyers are purchasers comply with technical restrictions, theISO is obliged to schedule those programs, even if they do not comply with minimum cost criteria of power networkg p g , y p y pexploitation. In this framework, in order to “isolate” as much as possible the power exchange from the powernetwork exploitation, the “Market Operator” – MO figure is created in some markets.

Constrained schedule

Unconstrained schedule

MOISO

Basically, when the MO exists, this entity will be in charge of financial markets (futures, forwards ... ), day ahead andeven intradaily markets (but always will need to coordinate with ISO to assure technical feasibility of the schedules). Inother market models, it will be the ISO the one in charge of all markets and only financial markets that don’t implyph sical deli er might be r n b a different entit (an e change)physical deliver might be run by a different entity (an exchange).

Hereinafter, unless otherwise stated, we will understand that we are facing a decentralized market. In the future, apresentation regarding the MO will be delivered and more details of power exchanges will be provided .

More detail on Market operators and Power Exchanges will be delivered in further presentations.

ISO –Independent System Operatorp y pVery high level voltage power network exploitation under reliability and economic criteria

Independent System Operator is an entity that coordinates, controls and monitors the operation of the electricalpower system in a reliable manner and following economic dispatching criteria.

The ISO coordinates the operation of the transport network in coordination with the transmission system operators.Its main objective is to maintain the system frequency (eg. US, 60 Hz; Europe, 50 Hz).

Depending on the market model, the ISO might have more or less power to control investment decissions of TSO,generators .... From the writer's opinion, grid planning should strongly rely on ISO’s recommendations, regardingreliability and power network efficiency.

Frequency controlV lt t lVoltage controlLoad flow controlOutage managementEconomic dispatching

ISO –Independent System Operatorp y pSCADA – Supervisory Control and Data Acquisition architecture

Independent System Operator is an entity that coordinates, controls and monitors the operation of the electricalpower system in a reliable manner and following economic dispatching criteria.

• RTU• IED

SCADA Server

• Lines• Transformers• Generationunits

• Shuntcapacitors,reactors

Network Topology

• Measure• Transmissionlosses

• Status

State Estimator

Load flow and voltage control

Monitoring and control is done byreactors…means of the SCADA system.

RTU Remote Terminal UnitIED Intelligent Electronic Device

Load flow and voltage control can be controlled by generation allocation, change in network topology, change oftransformer taps, use of reactors and shunt capacitors. Generators can also contribute injecting or absorbingreactive power. Advanced power flow control is an enormous field to be fostered.

Frequency control

The way to maintain system frequency is essentially matching at every moment power generation with system loady y q y y g y p g y(including power network losses). Different markets (usually based on auctioning processes) are held in order tomatch from the day ahead to as close as real time generation with load.

ISO –Independent System Operatorp y pSCADA – State estimation

State estimation

A process run in real time on SCADA systems in order to correct raw data and measurements coming from the fielddevices (RTU’s …) which filter measurement noise, detect gross errors and provides as an output estimatedi f i f d b d h il bl i f i d h k d l dinformation of system state and measures, based on the available information and on the power network modeledwithin the SCADA system.

State i bl

Topology processor

State variables: bus voltages, branch flows (MW, MVaR), …coming from field devices through RTUs, IEDs…

Processing

variables

Topology processor: gathers status of circuit breakers, switches,and represents the system topology.

ProcessingFiltering: identifies and eliminates incorrect data comingfrom fieldProcessing: estimates network status (open/closed ‐ circuitbreakers, shunt capacitors, reactors) and state variables (voltage, phase angles, transformer taps…)

Status Measures

ISO –Independent System Operatorp y pRepresentation of processes previous to day D

year ahead Months ahead

MO rket

year ahead Months ahead

MSO TF ac

ity R

ights

mar

annin

g

O’s) TLF

utage

ana

lysis

outag

e an

alysis

ssIS LT

ansm

ission

Cap

a

Grid

Pl

d dev

elopm

ent (

GENC

O

sed d

evelo

pmen

t

r TCR

MT

Gene

ratio

n ou

Tran

smiss

ion o

netw

ork

outag

e gen

erati

on un

its(G

ENCO

s)

e sch

edule

utage

gene

ratio

n unit

s(G

ENCO

s)

ssign

ment

Agen

tsO

Tra

ed de

velop

ments

Plan

ned

orise

d dev

elopm

ents

Autho

ris

Bids

for

ed ou

tage t

rans

miss

ion

Plan

ned o

miss

ion ne

twor

k outa

ge

Plan

ned o

TCR

as

The ISO interfaces with TRANSCOs Suppliers GENCOs and with the market operator (MO) in charge of Day Ahead

TRAN

SCO

Plan

n

Autho

Plan

n

Tran

s

The ISO interfaces with TRANSCOs, Suppliers, GENCOs and with the market operator (MO), in charge of Day AheadMarkets – DAM – and even intradaily markets). In many market models, the ISO is in charge of all markets, includingDAM, intradaily and ancillary services markets. In others, the MO handles day ahead markets.

ISO –Independent System Operatorp y pRepresentation of processes previous to day D

sMonths ahead Day ahead

MO

DAM

dule le ntr

aday

mar

kets

dule

ule

Months ahead Day ahead

MSO Un

cons

traine

d sch

ed

Cons

traine

d sch

edul

day m

arke

ts

(N) I

Unco

nstra

ined s

ched

y ana

lysis

Cons

traine

d sch

edu

marke

t

TLF

y ana

lysis

marke

t

sIS

Bid f

or D

AM

nstra

ined s

ched

ule

Bid

s for

per

iodic

Intra

d

Feas

ibility

strain

ed sc

hedu

leTCR

m ST

for T

CR

assig

nmen

ts Feas

ibility

al co

ntrac

ts

TCR

m

for T

CR

assig

nmen

ts

y righ

ts no

mina

tion

Agen

tsur

B

Unco

n

Unco

nsBid

TCR

a

Bilat

era

Bid

TCR

a

Capa

city

The ISO interfaces also with neighbour ISOs . Even in single zonal models a Transmission Capacity Market to manageneig

hbou

ISO

g g p y gtransmission capacity rights (TCR) between neighbouring networks must be defined. Usually there is an annualauctioning process between ISO and interested parties and also secondary markets can exists, in order to manageefficiently the TCR as real time market approaches.

ISO –Independent System Operatorp y pLong term load forecast as part of ISO processes

Projected 

Historical Economic factors

Economic factors Demographic 

data

MeteredLoad data

Time factors

Forecasting model

Historical weather data

Calendar datamodelweather data data

Winter peak LTF Summer peak LTFWinter peak LTF, Summer peak LTF

A long term forecasting (LTF) model is fundamental in order to understand which will be the peak and winter loadsA long term forecasting (LTF) model is fundamental in order to understand which will be the peak and winter loadsthat the power system will need to support. This will be an input for the grid planning function.

ISO –Independent System Operatorp y pGrid planning as part of ISO processes

Proposed M k A

Desired quality 

Regulatory framework

Market Agent projects Technological

factors

Power flow simulation

Transmission network (TN) 

existing 

metrics simulation

Stability analysis

Grid LTF

constraints

Short circuit lplanning

LTF analysis

Authoritasion / Denial / propositionAuthoritasion / Denial / proposition 

Grid planning under a centralized approach is fundamental to derive in market efficiency. The ISO must be enacted toauthorise, deny or propose long term power network development actions (including generation, transmission andload allocation if possible) so that the grid is developed under a sustainable and efficient criteria.

ISO –Independent System Operatorp y pMiddle term load forecast as part of ISO processes

Projected E iHistorical 

Economic factors

Economic factors Forward 

prices

MeteredLoad data

Time factors

Forecasting model

Historical weather  Calendar 

datamodeldata data

Medium term load forecastMedium term load forecast

A middle term load forecast for months ahead to even 1 year ahead is calculated. The objective is mainly outagemanagement. The forecasting algorithms used differ from those used for short term forecast (days ahead) and neartime forecasts (close to real time) and of course LTF.

ISO –Independent System Operatorp y pOutage analysis in order to guarantee power network reliability

MTLF

•Medi

Load 

MTLF

um Term

 forecast

•Lines •Transformers•Generation units•Shunt capacitors, 

Network topology

•Generation•Load

Peak scenario

•Lines•Generation units•Transformers

Contingency analysis

reactors, …

Outage schedule

The ISO models on the stable network topology a base scenario for peak loads (based on output from the middleterm load forecasting solution) The study can be executed either in the SCADA system (study mode) or in an

Outage schedule

term load forecasting solution). The study can be executed either in the SCADA system (study mode) or in anindependent (not part of SCADA) power system simulator. N‐1 scenarios are modeled (e.g simulating the outage of apower line, a transformer, etc) under the contingency analysis. Only planned outages that derive in acceptable results(in terms of load flows and voltage levels) are approved.

ISO –Independent System Operatorp y pShort term load forecast as part of ISO EMS system

Metered SCADA

Weather forecast

Load dataSCADA actuals

Prices

Weather actual

Time factors

Forecasting model

Historical weather  Calendar 

datamodeldata data

Short term load forecastShort term load forecast

A short term load forecast for 1D to even 1 week ahead is calculated and published by ISO. The frequency ofcalculation might be hourly and the granularity of forecasts usually hourly Different methodologies can be deployedcalculation might be hourly and the granularity of forecasts, usually hourly. Different methodologies can be deployed; most common are neural networks and statistical methods. Load forecast is published through the web to allinterested parties, so they can prepare bid stacks accordingly. The objective is to maintain system reliability.

ISO –Independent System Operatorp y pDifferent markets – from day ahead to real time operation

Day time of each marketPeriod ahead on which each market appliespp

1 2 3 4 5 6 7 8 9 10 11 13 14 16 17 18 19 21 22 23 1 2 3 5 6 8 9 10 12 13 14 16 17 18 19 20 21 22 23 24

Day D-1 Day D4 7 11 1512 15 20 24

Day -ahead marketIntraday 1

Compañía Operadoradel Mercado

Intraday 1Intraday 2

Intraday 3

Intraday 4Intraday 5

Intraday 6RED ELÉCTRICARED ELÉCTRICADE ESPAÑA

Technical constraints

Secondary Regul .Imbalances .

Imbalances .

Tertiary Regulation

T. constraints in real time

Imbalances .Imbalances .

Imbalances .

1 2 3 4 5 6 7 8 9 10 11 13 14 16 17 18 19 21 22 23 1 2 3 5 6 8 9 10 12 13 14 16 17 18 19 20 21 22 23 2412 15 20 24 4 7 11 15

A representation of the different markets held in Spain by the ISO. Day ahead markets and intraday markets are heldby the Market Operator (Power Exchange or Power Pool) in coordination with the ISO

Source: REE

by the Market Operator (Power Exchange or Power Pool) in coordination with the ISO.

ISO –Independent System Operatorp y pAnalysis of unconstrained programs

STLFUnconstrained 

schedule( )

•Short TermLoad forecast

•Unconstra

schedule•G

eneratiostacks

(MO)

m 

ained 

n bid 

• Lines • Transformers • Lines• Generation units

• Shunt capacitors, reactors, …

Network topology 

• Generation• LoadLoad flow

• Lines• Generation units

• Transformers

N‐1 cases • Load flows• Voltage levelsOPF

Optimal constrained program

All the parties make bids in order to maximize benefits. The (unconstrained) schedule that has been matched by the MOaccording to economic criteria (and even considering some technical characteristics of the generation units ‐ e.g. ramps) isanalyzed in conjunction with the bilateral contracts information under a load flow simulation and even stressed to N‐1 cases.After the scheduled program has been validated for technical conditions, a “constrained” schedule is generated and sent to theMO. The ISO only analyses the technical feasibility of the schedules, but does not run an OPF * to look for a minimum costsolution for the power network (in the sense that the matching algorithm results of the MO is respected as long as it compliessolution for the power network (in the sense that the matching algorithm results of the MO is respected as long as it complieswith technical restrictions) * clarification: conditional on the market agents bids, the solution obtained is optimal; it might beconsidered a constrained case of an OPF in which the ISO can determine each unit commitment based on a cost function, as in aregulated environment – pure centralized model – complete OPF, as we can see in next slide. All generation units are paid at theMCP (Marginal Clearing Price) for each of the time intervals in which it has been calculated.

ISO –Independent System Operatorp y pComparison of approaches ‐‐ How would it be under a pure centralized approach

STLFGeneration 

•Short Termforecast (b

•Planned out•Fixed costs•Variable co s m

 Load bus level)

tages

sts

• Lines • Transformers• Generation units

• Shunt capacitors, reactors, …

Network topology 

• Generation• LoadLoad flow

• Lines• Generation units

• Transformers

N‐1 cases • Load flows• Voltage levelsOPF

Optimal constrained program

Under a centralized approach the ISO would consider generation costs of all available generation units. According to minimumcost criteria, the ISO would find, running an optimal power flow, the minimum cost generation schedule. The generators wouldhave to assume the mandatory generation schedules imposed by the ISO. Each generation unit would be paid at its node pricel l If titi t b f t d l l i l i ld b id i t d N t th t d d t li d hlevel. If competition was to be fostered, local marginal prices would be paid instead. Note that under a decentralized approachthe ISO will not run an OPF considering cost prices of generation units; instead self committed prices fixed by the generatorswould be used. That is why we insist in clarifying that in a decentralized model, an “optimal” solution can be found butconditional on prices fixed by generators. In that sense, the solution obtained in an centralized model derives in a more efficientprogram, as it is not subject to gaming by market agents.

ISO –Independent System Operatorp y pOPF ‐ Optimal power flow

Optimal power flow

Once a state estimation has been run – real time dispatching (or a base case has been defined ‐ planning), an OPF canbe run. The OPF solves the power flow equations using control variables to achieve an objective function, as forexample to mimimise the cost of generation by means of control variables with upper and lower limits. In acentralized approach generation costs are considered and in a decentralized model generation bid stacks arecentralized approach generation costs are considered and in a decentralized model, generation bid stacks areconsidered.

b l

Network topology

Objective function

Control variables

State variables

OPFState

topologyconstraints

Control OPFState estimation variables 

constraints

Control variables parameterization

ISO –Independent System Operatorp y pGeneration of unconstrained programs (in many market models this is done by the MO)

MCP Auction processDemand (Purchase) 

Supply (sale)

MCVMCV

Unconstrained schedule

Usually in an auction – based process a MCP (Market Clearing Price) and a MCV (Market Clearing Volume) is obtainedfor each of the 24 hours of the day ahead market The algorithm specifications and the granularity of the calculations

Unconstrained schedule

for each of the 24 hours of the day ahead market. The algorithm specifications and the granularity of the calculationsare specific of each marketplace. The algorithm might be single zone or multi‐zonal based, include complexconditions from generators , etc. The unconstrained schedule will need to be further validated under an technicalpoint by the ISO.

ISO –Independent System Operatorp y pGeneration of constrained programs for DAM and intradaily markets

STLFU t i d h d l (MO)

Base case

STLFUnconstrained schedule (MO)

Optimal power flow Contingency (N‐1 ) analysis

Produce constrained schedule

Reliable?no

Publish

yesGENCO’s bid stacks

In case the unconstrained schedule does not derive in a reliable network exploitation solution, a feasible solution issearched until it complies with the AC network analysis. In some cases the AC OPF problem is approximated by DC‐OPF problems.

ISO –Independent System Operatorp y pRepresentation of processes (cont)

stionDay ahead

s on AGCIntraday

O

SO alanc

es m

arke

ts

ary f

req.

regu

lat

asibi

lity an

alysis

NTLF

alanc

es m

arke

ts

sibilit

y ana

lysis

ry fre

q. re

gulat

io

asibi

lity an

alysis

ncy r

egula

tion A

oltag

e con

trol

verlo

ad co

ntrol

nal e

xcha

nge

sche

dule

l dinati

on w

ith T

SO

asibi

lity an

alysis

I

imba

lance

s mar

ketIm

ba

ec. fr

eque

ncy m

arke

tSe

cond

Sche

dule

Fea

mbala

nces

mar

ketIm

ba

Sche

dule

Fea

ertia

ry fre

q. ma

rketTertia

r

Sche

dule

Fea

Freq

uen

GC si

gnal

Vo OvZon

Sche

dulef

or in

ter-zo

naex

chan

ge Coor

d

Sche

dule

Fea

GENC

Os Bid f

or

Bid f

or s

Bid f

or im

Bid f

or te AG

ighb

our

ISO

al ex

chan

gesc

hedu

le

A representation of the different markets held in Spain by the ISO. Day ahead markets and intraday markets are held

Nei

Zon s

by the Market Operator (Power Exchange or Power Pool) in coordination with the ISO.

ISO –Independent System Operatorp y pNear term load forecast as part of ISO EMS system

Metered SCADA

Weather forecast

Load dataSCADA actuals

Prices

Weather actual

Time factors

Forecasting model

Historical weather  Calendar 

datamodeldata data

Near term load forecastNear term load forecast

A near term load forecast for minutes / hours ahead is calculated by ISO EMS. The frequency of calculation might beeven 5 minutes and the granularity of forecasts might be 5 minutes as well The objective is to compare NTLF witheven 5 minutes and the granularity of forecasts, might be 5 minutes as well. The objective is to compare NTLF withthe STLF. Imbalance markets are called regularly during the day in order to cover those differences, and to keepsecondary regulation reserve.

ISO –Independent System Operatorp y pEconomic dispatching ‐ Ancillary services

Imbalances marketsIn order to manage imbalances that have not been covered by intraday markets, either because of change in the STLFor because of generation plants unavailabilities.

Secondary reserve marketIn order to cover the requirements of secondary reserve for the day ahead.

Secondary reserve is a spinning reserve which objective is to support the primary reserve (frequency control) and toy p g j pp p y ( q y )solve imbalances. It can be activated in very short periods (e.g available in 30 seconds – 15 minutes)

Tertiary reserve marketd l d i i iIn order to replace secondary reserve in case it is necessary.

Tertiary reserve is power capacity which can be connected under tertiary control, in order to provide an adequatesecondary control reserve. It can be activated in periods between 15 minutes – 30 minutes.

Frequency regulation by the AGCThe AGC (Automatic Generation Control) is an automatic adjustment signal sent to all AGC‐regulated generation unitsin order to compensate for ACE (Area Control Error ‐ Instantaneous difference between scheduled generation andactual load within a control area It is calculated as a frequency control mechanism in about 4‐10 seconds intervals byactual load, within a control area. It is calculated as a frequency control mechanism in about 4‐10 seconds intervals bycomputers in the dispatching center).

ISO –Independent System Operatorp y pGeneration of programs for Ancillary Services

Schedules STLF NTLFState estimator

Ancillary Service Request

Schedules STLF NTLFState estimator

Ancillary services bidsMatching algorithm

Produce constrained schedule 

Optimal power flowContingency analysis

Network topology

State estimator

Reliable?

yes

no Schedules

According to existing schedules, actual measures (state estimator), and the results of the STLF / NTLF, the capacity for

Publish

According to existing schedules, actual measures (state estimator), and the results of the STLF / NTLF, the capacity forancillary service is requested in order to cover forecasted imbalances. If secondary reserve has be used, tertiaryreserve is proportionately transferred to secondary reserve and more tertiary reserve is requested.

ISO –Independent System Operatorp y pReal time frequency control

Primary frequency reserveGeneration reserve which objective is to maintain a control area frequency and that can be activated immediately (5– 30 seconds) in a direction that stabilizes frequency. Turbine governors are the main source of frequency response. Itinvolves autonomous and automatic actions to arrest deviations in power system frequency whenever imbalancesp y q yarise between load and generation.

All generation units participate in primary control (mandatory). The settings on the governors are set locally, and theISO has not control on them (in the sense that they are not governed by AGC).

Primary reserve Secondary reserve Tertiary reservePrimary reserve

Local

Secondary reserve

AGC governed

l h d h h

Tertiary reserve

Replaces secondary reserve 

l h d h hMandatory

Response‐ 5 – 30 secs

Only generation units with AGC and whichhave offered regulation services in secondaryreserve market.

Response 30 secs‐ 15 min 

Only generation units with AGC and whichhave offered regulation services in tertiaryreserve market.

Response from 15 min …

ISO –Independent System Operatorp y pSecondary frequency control by AGC ‐ ISO dispatching center – EMS system

Actual generation 

(state estimator)

Scheduled interchange

Frequency Actual interchange 

AGCSecurity 

constrained economic 

GENCO’s AGC StatusAGCeco o c

dispatchS a us

AGC base points

The AGC scheme can be centralised or decentralised . In a centralised scheme a control area is assigned to a GENCO.Therefore each control area might be composed of many generation units regulated under the same master AGCTherefore, each control area might be composed of many generation units regulated under the same master AGCsignal. The master (ISO) AGC signal is sent to the different control area AGC, instead to each generation unit. In thisscheme, a GENCO can distribute the control area AGC regulation band between the different generation units.

ISO –Independent System Operatorp y pPower network control (real time) – voltage and overload control

RTU

•States•M

easure

RTU

• Lines

Voltage control at bus level

Voltage control

ements 

• Lines • Transformers• Generation units

• Shunt capacitors, reactors, …

Network topology 

• Generation• Transformer loads

• Flows

Stata Estimation

Analysis of load flows at power 

line & transformer level

Overload control

• Generation• Transformers taps

• Capacitor shunts

• Reactors

OPF

transformer level

Change network topology

In case the unconstrained schedule does not derive in a reliable network exploitation solution, a feasible solution issearched until it complies with the AC network analysis.

Voltage and load flows are monitored constantly. An alarm is displayed in the SCADA system whenever voltages orload flows violate predetermined ranges. Tap transformers, reactors, shunt capacitor, generation units, can be usedto control voltage and even to adjust load flows (changing the network impedances by moving transformer taps atcertain network nodes).If that is not enough, then it might be necessary to reassign generation schedules to change load flows, by means ofancillary services markets. A reactive power market can be applied as ancillary service.

ISO –Independent System Operatorp y pRepresentation of processes (cont)

D+ N ion

SO Invoic

ing

Settle

ment

read

ing ac

quisi

ti

I

Reso

lution

Meter

r•Instantaneous MW•Instantaneous MVaR

SCADARTU

SCADA database∫

∫dtMVaR

dtMW

.

.

s pute

uisitio

n

ment

•MWh•MVaRMetering 

devices Metering database

GENC

Os Disp

ter re

ading

acqu

stima

ted se

ttlem

Once the ISO (or a third party) has collected metering information from the metering devices (notice this is adifferent source than the information that was coming to the SCADA system in real time) the settlement is done to

MetEs

different source than the information that was coming to the SCADA system in real time) the settlement is done toGENCOs. The GENCO’s on the other hand have integrated metering information form their SCADA system, as well asmetering information from metering devices.After any dispute has been solved, the final settlement is conducted and invoicing takes place.

ISO –Independent System Operatorp y pThe role of the ISO in the smart grid development

h l d d l h f ll l f h kThe evolution towards a smart grid is clear. This for sure will require an evolution of the transmission power network,ISO’s workflows, processes and systems, in order to cope with marketplace demands. Some of the fields that willevolute in the future years are:

Advanced power flow control

HV Electronic power equipment (e.g bulk storage),FACTS (Flexible Alternating Current TransmissionSystems) D‐FACTS devices, CLD (current‐limiteddevices), etc

Advanced protectionSynchronised phasor measurements, computerrelay, advanced load shedding or even zonesplitting schemes.

Advanced network monitoring

Introduction of PMU’s (Phasor MeasurementUnits), improving state estimates, post‐disturbanceanalysis and generally speaking, control.g

Advanced economic di t hi h

AMR (Advanced Metering Reading devices) will leadtowards DR (demand response) frameworks that willrequire an evolution of the economic dispatchingdispatching  schemes require an evolution of the economic dispatchingschemes, including load forecasting.

ISO –Independent System Operatorp y pArchitecture

Corporate enterprise networkSecondary Control center

SCADA servers

SCADA Communication

servers

Datawarehouse

Settlementservers

Dispatcher consoles

Primary Control centerFinance Web

servers….

Secondary Control center

LAN

WAN

SCADA HistorianData server

Economicdispatch

Data server

Meteringsystemserver

Meteringcommunication

servers

Load forecastservers

External users

A simplified view of an ISO architecture. Duplicated sites with hot redundancy at each of the sites is absolutelynecessary to guarantee reliability.

Energy Trading & Risk Management Systems Group @ linkedingy g g y pA long road ahead

You are kindly invited to join ETRM Systems Group at linkedin, and to share with thegroup members presentations, papers, works related with ETRM systems andenvironments.

Want to collaborate with the ETRM Group? please contact with ETRM Groupmanagers

Leena Dsouza ldsouza4210@hotmail.comMack Frankfurter mack.frankfurter@iq3group.comEnrique Rivero eriveroa@gmail.comq @g