An Electricity Spot Market Mechanism for Hybrid Bidding of Fossil-fueled and Renewable Generators

Due to the problems of climate change and global warming, severe air pollution and energy security, there has been a stable growth of renewable energy integration into power systems during the past decades. This brings significant challenges to both short-term (electricity spot markets) and long-term (long-term bilateral and capacity markets) electricity markets. Against this background, the joint energy and ancillary service electricity market is studied in this paper for power systems with a high penetration level of variable renewable generation. In the proposed spot market mechanism, energy and frequency regulation service (FRS) bids are jointly cleared, where renewable generators are motivated to proactively manage the intermittency and uncertainty of their power outputs. Meanwhile, the proposed market mechanism can also ensure the adequacy of FRS capacity for compensating variability of renewables. Finally, numerical experiments are conducted to validate the proposed market mechanism and algorithms.