Day-ahead market design enabling co-optimized reserve procurement in Europe

Recent trend in expansion of intermittent power capacity in Europe invokes more demand for power control services and innovation in their market. In this paper, a market arrangement that enables simultaneous power exchange clearing and reserve capacity procurement is proposed. Motivation of implementing such co-optimized short term market in liberalized self-scheduling, power markets is discussed. Centralized and sequential market designs are outlined and important properties of co-optimized reserve procurement are presented. We develop a concept of combined energy-reserve offers to be submitted at voluntary power exchanges. Furthermore, clearing rules are demonstrated on examples and we investigate the design from multiple stakeholders´ point of view. Also, we find that the proposed design can alleviate the difficulties of system operators regarding reserve procurement.