Ancillary Service Markets

Ancillary services are generally referred as those services other than energy that are essential for ensuring reliable operation of electric power systems. This paper discusses different approaches for procuring required ancillary services for power system security. Furthermore, various design options for ancillary service markets are studied. Such markets are typically operated by an independent system operator (ISO). Different characteristics of each design option are also explained in this paper. The two most important factors which will be discussed for each design option are the price reversal phenomenon and total procurement cost.