Market Designs for the Primary Frequency Response Ancillary Service—Part II: Case Studies

The second part of this two-paper series analyzes the primary frequency response (PFR) market design developed in its companion paper with several case studies. The simulations will show how the scheduling and pricing change depending on whether requirements for PFR are included as well as how the requirements are defined. We first perform simulations on the base case IEEE RTS and show differences in production costs, prices, and amount of PFR when incorporating the PFR constraints. We show how new market designs can affect other linked markets when performing co-optimization. We then test a system with a significant amount of wind power, which does not provide PFR or synchronous inertia, to see how the incorporation of PFR constraints may become more critical on future systems. We then show how pricing can reduce make-whole payments and ensure resources needed for reliability reasons are incentivized. Lastly, we show how resources that improve their capabilities can earn additional profit if the improvement is needed ensuring the incentives can work for innovation in PFR capabilities.