1

Technical and Economic Improvements of the AGC Spanish Scheme

Jos Ignacio de la Fuente, Juan Luis Zamora
Instituto de Investigacin Tecnolgica Escuela Tcnica Superior de Ingeniera (ICAI) Universidad Pontificia Comillas 28015 Madrid nacho@iit.upco.es, zamora@iit.upco.es

Agustn Martn Calmarza

Escuela Tcnica Superior de Ingeniera (ICAI) Universidad Pontificia Comillas 28015 Madrid martincalm@argen.net

Abstract-- The present Spanish Automatic Generation Control (AGC, also known as secondary reserve) is based on a hierarchical control structure. A master regulator constitutes the top of this hierarchy. Below this regulator are placed the 4 major control areas (corresponding to the 4 main generation utilities that nowadays participate in the AGC service). Each control area is composed of several generation units under AGC control. The master regulator is known in the Spanish terminology as RCP Regulacin Compartida Peninsular which stands for Shared Peninsula Regulation. This regulator sends coordination signals to the different control areas to keep France inter-tie power exchange and system frequency at their scheduled values. The regulation of both magnitudes should be carried out with an standardized dynamic response. The present article proposes an improved secondary reserve auction mechanism that will imply a better RCP performance since both technical and economic points of view. Index TermsOperation under market conditions, system services in deregulated markets, AGC, secondary reserve, auction mechanisms, Ancillary Services Markets

I. INTRODUCTION

HE present RCP algorithm [1,2] runs in real time (every 4 seconds) and takes into account in the evaluation process of the coordination signals which sends to the different control areas, how their respective dynamic responses match or not the already mentioned standardized dynamic response. If a control area does not fulfill the dynamic response requirements, its participation in providing AGC service will be decreased. Beside this, the remuneration for providing AGC service will be decreased as well, with respect to the nominal remuneration obtained in the secondary reserve (AGC) auction mechanism which runs every day in Spain after the energy day ahead market. There exist certain shortcomings associated with the present secondary reserve auction mechanism used by the System Operator (SO) and with the present RCP algorithm. On one hand, the daily Spanish secondary reserve market (which is cleared after the energy day ahead market), does not use any information regarding the dynamic capability of the

different AGC service bidders. I.e., all the different AGC bids are treated by this AGC market as uniform bids, regarding their potential dynamic capability. However, in practice, the different units technologies that participate in this market present a wide range of dynamic capabilities. For instance, hydro units present faster responses compared with thermal units. On the other hand, the present RCP algorithm is equipped with a monitoring system that supervises the dynamic response adequacy of the different control areas. However, nowadays this supervision task is not very efficient. This is due to: 1) The discrete characterization of the measured control areas dynamic performance that is carried out in real time by the RCP algorithm. 2 control area main states are nowadays considered by RCP: ACTIV mode if the control area dynamic response matches with the standardized response and EMERGENCY mode if the control area dynamic response remains below the standardized dynamic response. 2) Lack of sensitivity of the present RCP monitoring system. Only if great disturbances take place in the system, the RCP is able to distinguish if a control area is responding according with the standardized dynamic. Otherwise RCP lacks of sensitivity in monitoring adequate or wrong dynamic performances. The article is structured as follows. In first term, a brief review of the present RCP algorithm is carried out. Secondly, the main shortcomings associated with the present RCP algorithm and with the present secondary reserve auction process are addressed. Next, the proposed improvements in the auction mechanism are described. Finally, the present market scheme and the new auction design are compared in 2 case studies, illustrating the technical benefits of the new AGC auction mechanism proposed. II. BRIEF DESCRIPTION OF THE PRESENT RCP ALGORITHM The aim of this paragraph is to provide a brief overview of the criteria and logic of the present RCP algorithm. The next figure shows the present Spanish AGC hierarchical control scheme:

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1

2 3

RCP

ZONE 1 ZONE 2 ZONE 3

ZONE 4

2.

the AGC service, according with the quantity of reserve that has been assigned in the present Spanish secondary reserve market. The real time dynamic performance of the control area (quality of reserve) monitored in real time by the RCP. III. SHORTCOMINGS ASSOCIATED WITH THE PRESENT RCP CONTROL ALGORITHM

Fig. 1. Present Spanish AGC Scheme

The numbers which appear in the previous figure correspond to the following real time information flows (measured every 4 sec.) between the master regulator (RCP) and the control areas: 1. Frequency and France inter-tie exchange. 2. Real time power under AGC control corresponding to each control area, upper and lower control generation limits and deviation of the global generation of each area with respect to its schedule (NID). 3. Coordination signal that RCP sends to every control area (CRR) and zone state (the most relevant states are ACTIVE mode and EMERGENCY mode, as mentioned above). A. Area regulator The regulator corresponding to area i receives the coordinating signal CRRi , which is computed in real time by the RCP algorithm. The main goal of this coordinating signal is to restore both France inter-tie exchange and frequency to their scheduled values with an appropriate dynamic response. The Area Control Error (ACE) is obtained by adding up a) the coordinating signal CRRi sent by RCP b) the frequency error (Bias term) and c) the deviation with respect to the generation control area schedule (NID): ACEi= Term proportional to NID + Bias term + CRRi (1) Every control area should drive to zero its own ACE with a certain dynamic. The standardized dynamic response imposed by the RCP to monitor the quality of secondary reserve provided by each control area (i.e., dynamic at which reserve is transformed into energy) is given by a 1st order dynamic system with a time constant equal to 100 sec. B. Master regulator (RCP) The main functions of the master regulator (RCP) are: 1. To determine the state of each control area (reserve quality monitoring). 2. Computing the global regulation requirement (PRR) 3. Computing the coordination signals (CRR) to be sent to every control area i: CRRi = Ki PRR (2) The global regulation requirement PRR which is computed by the RCP is shared among control areas by means of the gains Ki that vary in time taking into account: 1. The hourly nominal participation of the control area in

The present RCP algorithm was developed in a framework where electric utilities were vertically integrated. Since January 1st 1998 a day ahead wholesale electricity market has been running in Spain. In parallel with this market 2 Ancillary Services markets has been established: one for AGC service provision (secondary reserve market) and the other one for the provision of tertiary energy that is used to reset the net usage of secondary reserve. The electric business has been structured in several generation and distribution utilities and a transport company. The later acts as System Operator (SO) as well. Thus, the former control areas which integrated both generation and consumption have turned into single generation control areas; i.e., without taking care of consumption deviations. Thus, the frontiers of the present control areas are placed in the high voltage bus bars of the different generation units that form the control area. Next, the shortcomings associated with the present RCP algorithm are described: 1) Present RCP algorithm carries out a rough characterization about the quality (dynamic response) of the reserve provided by each control area, measured in real time. This is due to the fact that this characterization is carried out in a discrete fashion: ACTIV (dynamic performance faster than or equal to the standardized dynamic response) and EMERGENCY (dynamic response slower than the standardized response). 2) The existence of thresholds and dead bands in the present RCP algorithm implies a lack of sensitivity of the present monitoring system to detect bad dynamic performance of some control area. Thus, only when appreciate disturbances take place in the system, the RCP quality monitoring system is able to discriminate among an adequate dynamic performance and a bad dynamic performance. In the case of a smooth load following performance, the RCP is usually unable to distinguish in real time if the dynamic performance of a control area is or not adequate, due to the mentioned lack of sensitivity. 3) Finally consecutive changes from ACTIV to EMERGENCY at control areas and oscillatory behavior at France inter-tie exchange have been monitored in some cases. At [3] a new RCP algorithm is proposed whose aim is to overcome the above problems. However, this paper is more focused on improving the present secondary reserve auction mechanism, whose shortcomings are described below.

3 IV. SHORTCOMINGS ASSOCIATED WITH THE PRESENT SECONDARY RESERVE AUCTION MECHANISM The present Spanish AGC reserve auction mechanism creates a merit order list considering only the pairs [bid reserve, bid price]. Then, the present Spanish secondary reserve auction mechanism does not consider the fact that the dynamic performance of the different reserve bids will clearly vary depending on the type and technology of the unit that is bidding reserve. Nowadays, SO assumes that, in principle, all the reserve bids are uniform from a dynamic performance point of view. Later, the RCP monitoring system will verify with the already mentioned shortcomings if control areas fulfill or not the required dynamic performance. I.e., all the responsability to warrant the adequate quality (dynamic response) of the secondary reserve relies nowadays in the RCP monitoring system that presents the aforementioned problems. V. IMPLICATIONS FOR CONTROL AREAS AND FOR SYSTEM OPERATOR Both RCP and secondary reserve auction shortcomings described above have a remuneratory impact over different control areas. This is due to the fact that AGC service remuneration is composed of 2 terms: A fixed term determined in the secondary reserve market. A variable term that depends on the real time dynamic performance of the different control areas, monitored by RCP. It should be warranted that control areas are remunerated according with the useful reserve that provide in real time. Otherwise, there will be no incentive for control areas to have an adequate dynamic performance. Nowadays, due to the fact that the present secondary reserve auction mechanism does not discriminate secondary reserve bids with different dynamic responses, it is not warranted that marginal prices obtained in this market are associated with a product (reserve) with a certain level of quality (dynamic response) associated. Regarding the System Operator (SO), nowadays it is uncertain for it if the global amount of reserve that buys in the secondary reserve market has or not the required quality level (dynamic response with time constant = 100 s.). Then, if there exists uncertainty regarding the quality of the acquired reserve, the only mechanism that can use the S.O. to warrant the security of the system is by increasing the amount of global reserve bought. VI. IMPROVEMENTS OF THE SECONDARY RESERVE MATCHING ALGORITHM In this paper a new secondary reserve matching algorithm is proposed. The basic idea is that, besides the pair quantity-price associated with each bid, every bidder should declare in its bid some information regarding its expected dynamic performance. This basic dynamic performance information can
Bidder 2: Price2 ($/MW) Quantity2 (MW) Dynamic performance: Time delay2 (seconds) Ramp ratio2 (MW/min.)

be summarized in 2 items: Time delay (seconds): since the unit is called upon to provide reserve until its generation level starts to increase/decrease. Ramp rate (MW/min): increase/decrease ratio at which secondary reserve can be used. The system operator will use this dynamic information of each bidder to transform each bid reserve quantity into useful reserve. As mentioned above, in Spain the reference dynamic performance is given by a 1st order system with a time constant of 100 sec. Then, the useful reserve is determined for each bid as the portion of bid reserve which can be transformed into energy in 100 sec. The next figure summarize the new proposed matching algorithm.
Bidder 1: Price1 ($/MW) Quantity1 (MW) Dynamic performance: Time delay1 (seconds) Ramp ratio1 (MW/min.) MATCHING SECONDARY RESERVE ALGORITHM 1. Using the dynamic performance information of each bid, transforms every bided quantity in reserve which can be provided in the especified time horizon (100 seconds); i.e., the useful reserve is determined 2. Build up an aggregated bided curve formed by the pairs [useful reserve, bided price], in an ascending fashion, from the cheapest to the most expensive bid. 3. According with the total hourly System Operator secondary reserve requirement, the winning bids that fulfill that requirement at least cost, are determined

Fig. 2: New secondary reserve matching algorithm for RCP

There are several advantages associated with using this new approach to match reserve: 1. On one hand the System Operator (SO), unlike in the present situation, has more warranties that the whole amount of reserve acquired in the secondary reserve market fulfills the required dynamic performance. Nevertheless, the improved secondary reserve auction mechanism is not enough to warrant the quality of the secondary reserve, and it is necessary to improve the RCP monitoring mechanism [3] to check if the bid dynamic response matches the real time performance. 2. The SO is more confident that the resulting secondary reserve marginal price is associated with a product with a warranted level of quality. 3. Clearly, using this matching algorithm, the performance of control areas under RCP control remains most of the time in ACTIV mode, which allows a smooth behavior of RCP algorithm. When quality of the reserve is not warranted in a first step by the auction mechanism, more often changes from ACTIV to EMERGENCY states can occur. This fact causes a negative impact over AGC dynamic performance. 4. The remuneratory treatment is clearly more fair since units which provide AGC service are paid according with the usefulness of the reserve that provide. 5. Finally, both France inter-tie exchange and frequency restoration dynamics are clearly better when the secondary

4 reserve acquired by the SO has a better quality, as is shown in case study 2. VII. CASE STUDY 1: CLARIFYING EXAMPLE In this clarifying example, table 1 shows the characteristics of the different secondary reserve bids submitted to the SO for a given hour. Units B, C and E are typical examples of thermal units (slow ramp ratios) while units A, D and F try to represent faster hydro units responses.
Unit Bided upward Bided Ramp ratio reserve (MW) downward reserve (MW) (MW/MINUTE) 30 20 15 25 35 25 45 25 20 10 8 15 40 25 30 25 60 5 3 100 4 50 20 10 Reserve bided price (pts/kW) A B C D E F G H 0.7 0.8 1 2 0.2 0.4 1.5

Being this later value lower than the bid quantity (20 MW of upward reserve), only 8.33 MW are useful for the SO. Table 3 shows the reserve dispatched to each unit when the new secondary reserve auction mechanism proposed in this paper is applied. Units have been re-ordered in the table from the cheapest to the most expensive bid prices. It should be noticed that, under the new scheme, SO is able to fulfill its upward and downward reserve requirements with useful reserve. I.e., assuming that bid ramp ratios match the real time performance of the different units, SO can warrant that the global amount of upward and downward reserve acquired in this market verifies the pre-specified quality standards. Beside this, in this example, it can be observed that both upward and downward reserve marginal prices turn out to be 2 ptas/kW (ptas stands for peseta, the Spanish currency).
Unit Useful upward reserve 6.66 25 16.66 30 8.33 5 33.3 5 130 100 Useful downward reserve 6.66 25 16.66 20 8.33 5 18.5 Bided upward reserve 35 25 25 30 20 15 45 25 Bided downward reserve 40 25 25 20 10 8 30 15 Bided price (ptas/kW) 0.2 0.4 0.5 0.7 0.8 1 1.5 2

E F H A

0.5

Table 1: Secondary bids characteristics

C G D Total

It is assumed that SO global upward and downward secondary reserve requirements are given by: Upward global requirement: 130 MW Downward global requirement: 100 MW
Unit Useful upward reserve (MW) 30 8.33 5 25 6.66 25 33.3 16.66 Useful downward reserve (MW) 20 8.33 5 15 6.66 25 30 16.66 Bided price (pts/kW). 0.7 0.8 1 2 0.2 0.4 1.5 0.5

Table 3: Secondary reserve dispatch under the new secondary reserve auction mechanism proposed

A B C D E F G H

Table 2: Upward and Downward useful reserve

Table 2 shows the transformed bid quantities carried out by the SO, under the new auction algorithm proposed in this paper. The new algorithm obtains the useful reserve, i.e, the reserve that can be transformed into energy in 100 seconds (present Spanish dynamic response standard). For instance, unit B has bid 20 MW of upward reserve, but has a ramp ratio of 5 MW/minute. If this unit can transform 5 MW from reserve into energy in 1 minute, in 100 seconds can transform 8.33 MW.

Finally, table 4 represents the secondary reserve dispatch that is obtained applying the present Spanish auction scheme. There are 2 minor differences of the algorithm applied in this example from the real Spanish auction algorithm [2], which have not been considered for simplification reasons: a) In the real Spanish algorithm there is a single marginal price applied for both upward and downward reserve. I.e, there is no a separation in 2 markets (upward and downward reserve). In oppinion of the authors, it is more convenient to create a separation of an upward and a downward secondary reserve market. Among other reasons, unit costs incurred to provide upward reserve may clearly differ from unit costs incurred to provide downward reserve. b) In the real Spanish algorithm there exists a constraint that should be fulfilled by each control area (group of control generators belonging to the same generation company). This constraint force to the ratio [upward dispatched reserve/ downward dispatched reserve], for each control area, to be equal to the ratio [global reserve upward requirement / global reserve downward

5 requirement].
Unit Useful upward reserve (MW) 6.66 25 16.66 30 8.33 Useful downward reserve (MW) 6.66 25 16.66 20 Dispatched upward reserve Dispatched downward reserve Bided price (ptas/kW)

E F H A B C G D MW

35 25 25 30 15

40 25 25 10

0.2 0.4 0.5 0.7

auction algorithm is used to determine the dispatch of units that provide AGC reserve and b) the new matching algorithm that considers the usefulness of every bid is used to define the dispatch of the units that will provide AGC reserve (the required quality is given by a 100 seconds time constant). The next figure illustrate how the new matching algorithm achieves a better control of the France inter-tie schedule with respect to the present one.
France intertie exchange:1-present scheme (*),2-New scheme(+),3-Without RCP(x) 150

100

0.8 1 1.5 2
Mw 50

-50

86.65

68.32

130

100
-100

Table 4: Secondary reserve dispatch under the present Spanish secondary reserve auction mechanism

-150 0 2000 4000 6000 8000 10000 12000 14000 16000 18000 time (seconds)

By comparing tables 3 and 4, the following conclusions can be derived: The new auction algorithm warrants that the global amount of reserve acquired by the S.O. (130 of upward reserve and 100 MW of downward reserve) is useful reserve, i.e., reserve which can be transformed into energy according with the standarized dynamic response (100 seconds). The present Spanish algorithm does not warrant that the global amount of reserve acquired is useful reserve. In fact, examining table 4 it can be concluded that the S.O. has acquired 86.65 MW of useful upward reserve (instead of 130 MW) and 68.32 MW of useful downward reserve (instead of 100 MW). The marginal prices under the new auction scheme turn out to be higher than those obtained under the present scheme. These resulting marginal prices are: 2 ptas/kW and 1.5 ptas/kW for upward and downward reserve respectively under the new market scheme (see table 3), and 0.8 ptas/kW and 0.7 ptas/kW for upward and downward reserve respectively, under the present scheme (see table 4). I.e., obviously is more expensive to warrant that the global amount of acquired reserve has a warranted dynamic performance. Nevertheless, an important aspect that should be taken into account is that if S.O. improves the quality of the reserve acquired, it could reduce the global amount of reserve acquired, keeping the same levels of security and reliability in the system, and then moderating the expecting marginal price increase. VIII. CASE STUDY II: REALISTIC CASE Firstly, a simulation of the present RCP algorithm has been carried out, facing a sinusoidal wave as demand disturbance in the Spanish system in 2 cases: a) the present secondary reserve

Fig. 3: Deviations of France inter-tie exchange from scheduled value, with the present and with the new auction algorithm.

Secondly, a more realistic simulation has been carried out simulating the RCP performance facing a real daily load evolution. A whole day operation has been simulated. Figure 4 shows the relationship between the France inter-tie exchange departures from the program, i.e., the RCP capability to keep the inter-tie power exchange at its scheduled value, with respect to the quality level imposed by the SO through the new AGC reserve auction mechanism. This capability has been measured in terms of the standard deviation of the daily intertie departures from schedule. This figure has been obtained simulating the RCP performance during 1 normal operation day for every level of quality (time constant) imposed.
Standard deviation in MW of Franceintertie exchange with respect to quality ofreserve

180

160

140

120

100

80

60 0

100

200

300

400

500

600

700

Time constant imposed by the S.O. in the auction process

Fig. 4: France inter-tie exchange departures from program levels with respect to quality of reserve acquired by SO.

Figure 5 shows the accumulated values of France inter-tie exchange deviations (accumulating the absolute value of such deviations) measured along a whole day in 2 cases: using the AGC reserve dispatch obtained with the present auction mechanism (upper curve), and using the reserve dispatched with the new auction

6 algorithm proposed in this paper (lower curve). As in figure 4, the disturbance applied has been a realistic Spanish daily load curve. The reserve quality level imposed by the new auction algorithm is given by a time constant of 100 seconds. Clearly the improvement in AGC reserve quality is reflected in a lower accumulated value of inter-tie deviations.
Accumulatedvalue of France intertie deviationsfrom schedule in [MW x control steps] 2 1.8 1.6 Present Spanish auction algorithm 1.4 1.2 1 0.8 0.6 0.4 0.2 0 0 0.5 1 Control steps (1 control step = 4 seconds) 1.5 x 10 2
4

x 10

New auction algorithm

reserve that acquires in the AGC reserve market, which runs every day under the deregulated Spanish electric system, has an adequate level of quality (dynamic response). The quality of the reserve is a key aspect to keep an adequate level of security, reliability and quality of supply in the system. This paper proposes to carry out this task in 2 phases: a) running the new secondary reserve auction process proposed in the paper, which takes into account the declared dynamic performance of each bidder and b) improving the real time monitoring system used nowadays in the AGC Spanish scheme. The 2 case studies exposed show that if the new auction mechanism is used, the acquired reserve has a better quality, and this implies a better dynamic performance to keep the France inter-tie exchange and frequency at their rated values. X. ACKNOWLEDGMENT This work reflects partial results from bachelor thesis of the third author, Mr. Agustn Martn. Authors highly appreciate technical comments and advice from Mr. Juan Moreno and his team from Red Elctrica S.A., and from Mr. Gregorio Relao and Mr. Rodolfo Martnez from Iberdrola S.A. XI. REFERENCES
[1] V. Garca-Echave et al. Regulating System for the coordination of the multiple AGCs of the Spanish Peninsular Utilities as a Unique Control Area. Description and Field Experiences. CIGRE International Conference on Large High Voltage Electric Systems. 1984 Session. Procedimiento de Operacin P.O. 7.2. Red Elctrica de Espaa (S.A.). L. Olmos et al. Load-Frequency Regulation Using an Adaptive Predicitive Control. Paper accepted for 2001 Porto IEEE Power-Tech Conference.

Fig. 5: Comparison of performance of RCP algorithm with 2 different AGC reserve dispatchs: a) Present auction algorithm and b) New auction

Finally, figure 6 shows how the AGC reserve marginal price obtained with the new auction algorithm (with fictitious AGC reserve bids) depends clearly on te level of AGC reserve quality imposed by the SO. It is interesting to focus in two interesting points of this curve: On one hand, the point corresponding to the present standarized quality level (time constant= 100 seconds). Secondly, the asintotic price value reached when it is decreased the quality level imposed to AGC bought by SO, i.e., when is increased the time constant imposed. This asintotic value should match to the marginal price obtained with the present auction algorithm, when no reserve quality level is imposed.
Auction marginal prices in ptas/kW

[2] [3]

XII. BIOGRAPHIES
Jos Ignacio de la Fuente was born in Soria, Spain, in 1967. He obtained both his B.S. and Ph.D. degrees in Electrical Engineering from Universidad Pontificia Comillas (UPCo), Madrid, in 1990 and 1997 respectively. Currently, he is a researcher at the Instituto de Investigacin Tecnolgica (UPCo). He also teaches Power Systems at the Engineering School ICAI, in the same university. His interest areas include power systems control and optimization, ancillary services procurement and remuneration, energy bidding strategies and power quality issues. Juan Luis Zamora graduated in control and electronics engineering at the Universidad Pontificia Comillas (UPCO) in 1991. From 1991 to 1997 he was a postgraduated student at the Instituto de Investigacin Tecnolgica (IIT) of the UPCO. In 1997 he received the Ph.D. degree from the UPCO. From 1997 he belongs to the research staff of the IIT and is a lecturer in the Department of Electronics and Control in the UPCO. His areas of interest include control engineering, system identification, electronics and signal processing. Agustn Martn was born in Las Palmas de Gran Canaria, Spain, in 1977 and has just obtained his Bachelor Degree in electrical Engineering from Universidad Pontificia Comillas (UPCo), Madrid, 2001. His interest areas include power system control and ancillary services topics.

5 4.5 4 3.5 3 2.5 2 1.5 1 0.5 0 100 200 300 400 500 600

Time constant requirement

Figure 6: AGC reserve marginal price evolution with respect to the reserve quality level imposed.

IX. CONCLUSIONS The System Operator should warrant that the secondary