CIGRE working group explores the challenges of meeting reliability standards and complying with market rules
Compliance with reliability standards has been an obligation on power system planners and operators for many years. More recently the requirement to also satisfy market rules, which are driven by commercial objectives has created challenges for System Operators. Working Group C2/C5.05 has recently produced Technical Brochure 688, ‘Development of Reliability Standards and Market Rules’. The Australian member on this working group is Mark Miller. For this first stage of a 2-stage project, a review of historical, current and future development of reliability standards and market rules in several countries has been completed. The second stage will examine the current and developing challenges associated with the adverse impacts on market mechanisms when trying to comply with reliability standards. This will include consideration of the impact of new technologies such as intermittent renewables, storage etc. This work is very topical in Australia and many other countries and should be of considerable interest to stakeholders.
JWG C2-C5.05 Development of Reliability Standards and Market Rules
The term Reliability is generally understood to be a minimum level of resource adequacy and transmission grid integrity (security and performance level) to meet system demand and support electricity trading activities.
In most instances, system reliability is maintained through compliance with a set of reliability standards. With the advent of liberalisation, system operators now have another set of rules to observe and apply in managing the power grid – the market rules. System operators find themselves facing the increasing challenges of having to meet the simultaneous objectives of adhering to reliability standards and observing market rules.
JWG C2/C5-05 has just completed the first stage of a 2-stage project to identify the challenges to system operators when they attempt to balance between adhering to reliability standards and observing market rules, and manage the interactions between them.
Technical Brochure 688 summarises the results of the Stage 1 effort, which involves a review of the development of reliability standards and market rules in several countries and markets. These are: Europe, North America, Australia, Japan, South Africa and Brazil.
From the review, the following key observations were made:
1. Reliability Standards Development
All countries/markets included in this review started the development of reliability standards well before electricity market liberalisation. With the advent of market liberalisation, some of the reliability standards have been expanded to address issues that may arise from new and increased market activities.
While reliability standards in most countries/markets have matured and reached a rather stable state, development of new and revised standards is still ongoing as newly identified risks and potential impacts on the interconnected power grid emerge.
2. Market Rules Development
The status of market rules development varies among countries/markets, depending on the stage of evolution. For mature markets, i.e., those that started liberalisation in the 1990’s, market rules development has reached a rather stable state. However, as new technology and increased participation/activities by new market entrants emerge, new and/or revised market rules need to be developed to enable fair and equal access to the electricity markets.
3. The JWG further assessed that some of the reliability standards and market rules may be intertwined, and that compliance with reliability standards may have certain adverse impacts on market mechanisms (efficiency), and vice versa. A detailed review and assessment of such challenges will be conducted at Stage 2 of this task.