Energy Imbalance Markets
The anticipated growth of variable renewable generation, such as solar and wind power, in the West has raised concerns about how system operators will maintain balance between electricity production and demand in the Western Interconnection—and especially in its smaller balancing authority areas. This concern helped motivate a proposal to develop an energy imbalance market. An energy imbalance market aggregates the variability of electricity generation and load for multiple balancing authority areas and utility territories, and performs a 5-minute security constrained economic dispatch. This can increase the economic efficiency of the power system. This subhourly, real-time energy market provides centralized, automated, and region-wide generation economic dispatch. By increasing the temporal and geographic footprint of the total balancing authority area, the market could moderate the variability of renewable generation resources and electricity demand.
NREL has worked with the Western Electricity Coordinating Council and others to assess the potential ramping and reserve benefits of several forms of an energy imbalance market. At the request of public utility commissioners in the West, NREL used a detailed electricity production simulation model to obtain deeper insights into the potential benefit of alternative forms of an energy imbalance market. The results were shared with utility commissioners and other stakeholders to inform future decision making for Western Interconnection operations. In 2014, the California Independent System Operator (CAISO) and PacifiCorp will begin operating an energy imbalance market, and NV Energy is expected to join in 2015. Through the MC Initiative, the Northwest Power Pool is currently investigating similar wide-area economic dispatch models, and will evaluate whether an energy imbalance market or similar market will be developed.
For More Information
For more information about NREL's work on energy imbalance markets, see the following resources. Additional publications can be found in the NREL Publications Database.
Energy Imbalance Markets
This fact sheet provides an overview of energy imbalance markets.
Examination of Potential Benefits of an Energy Imbalance Market in the Western Interconnection
This study focuses on identifying the potential benefits of an energy imbalance market in the year 2020.
Operating Reserve Reductions From a Proposed Energy Imbalance Market With Wind and Solar Generation in the Western Interconnection
This paper considers several forms of an energy imbalance market proposed in the nonmarket areas of the Western Interconnection and their impact on system operating reserves.
Flexibility Reserve Reductions From an Energy Imbalance Market With High Levels of Wind Energy in the Western Interconnection
This paper considers several forms of an energy imbalance market proposed in the nonmarket areas of the Western Interconnection and their impact on system flexibility reserves.
Alternative Approaches To Calculate Benefits of an Energy Imbalance Market With Wind and Solar Energy
This paper estimates reserve requirements for regulation, spinning, and non-spinning reserves with and without an energy imbalance market. It also covers alternative approaches to allocating reserve requirements and shows that some allocation methods have undesired consequences.
Operating Reserve Implication of Alternative Implementations of an Energy Imbalance Service on Wind Integration in the Western Interconnection
This paper describes an energy imbalance market's implication on operating reserves under several alternative scenarios of market footprint and participation.