Competitive Electricity Market for Spinning Reserve Evaluating the System Dynamic Behavior

The electric sector trend from vertically integrated structures to competitive structures outlines the need of exhaustive studies of Ancillary Services (AS) not only from the operative point of view but also from the economic one. In this paper the Spinning Reserve (SR) is the AS analyzed. This paper proposes a methodology to determine the optimal level of SR required by the system and its optimal allocation in competitive electricity markets. This methodology carries out a joint economic dispatch of energy and SR, determining with this, the corresponding prices of each service for each generating unit. To achieve these objectives, the proposed methodology not only considers the economic aspect but also uses weighted factors as the speed of dynamic response and the geographical-electric location of each generating unit to improve the system dynamic response against different outages.