Analysis of the market-based service provision for operating reserves in the Netherlands

The electricity sector liberalisation in Europe has contributed significantly towards the creation of competitive markets. The wholesale trading of electricity consists of a market-based segment often complemented by markets for ancillary services, including the provision of operating reserves. In this paper, the authors examine and classify operating reserves that are currently traded in the Netherlands. The principles, under which the provision of these reserves is verified by the Dutch Transmission System Operator (TSO), are illustrated, and inefficiencies of the current verification approach are identified. The verification process of the TSO takes into account specific conditions, but the criteria for assessing the quality of the service provision are not explicitly defined. Furthermore, only a limited number of cases can be assessed due to the non-automated nature of the process. Finally, a proposal is made for the development of an automated analysis tool for assessing the service provision of market parties. This proposal emphasises the need for more robust verification processes in line with the increasing integration of electricity markets in Europe.