Market Design for System Security: Managing Secure and Stable Transitions in a Decabonised Electric Grid
The electricity market is experiencing a rapid shift away from traditional synchronous and dispatchable forms of generation, towards increasingly asynchronous and variable generation. The market and dispatch challenges relating to this transition can be broadly categorised into either (i) system energy balancing a high share of variable generation sources and (ii) the challenge of maintaining system security and stability with an increasingly inverter-interfaced generation system. In addition, the contribution to certain system requirements, such as inertia and system strength, that were previously provided as a consequence of having synchronous energy provision meant that there was little need to specifically procure those characteristics in the network. The phase out or retirement of large thermal generators, which have historically provided that inertial contribution, has in some markets resulted in shortfalls of inertia and system strength in regions with high renewable penetrations.
This paper will focus on the issue of system security. System security refers to the ability of the power system to tolerate disturbances and maintain a stable operating state for electricity supply following a disturbance. It is evident that the dispatch of energy in the energy only market cannot be expected to guarantee the provision of these services in the future. Market and regulatory frameworks thus need to adapt to cater for the system security requirements of an electrical network, in addition to raw energy provision. The key challenge before market designers and policy makers is how to adapt market and regulatory frameworks, and importantly how those frameworks interact with the management of risk across the electricity sector.