Overview of the Operating Reserve Market in Alberta

Overview of the Operating Reserve Market in Alberta In this article, we will provide you with an overview of the Operating Reserve Market in Alberta. We'll cover who can participate in the market, how it works, the frequency and duration of curtailment periods, current rates, the benefits of using an aggregator, and who should consider participating in the Operating Reserve Market.

What is the Operating Reserve Market for Alberta's electricity grid? The Operating Reserve Market serves as a crucial mechanism to ensure the reliability and stability of Alberta's electricity grid. It functions as a safety net by maintaining a pool of resources that can be called upon when unexpected events or emergencies affect the balance of supply and demand.

Who can participate in the Operating Reserve Market? Various entities have the opportunity to participate in the Operating Reserve Market in Alberta. This includes power generators, energy consumers, and aggregators. Industrial facilities, institutional facilities, and commercial facilities that have onsite energy generation capabilities can actively contribute to the market. Additionally, anyone who can curtail electricity with short notice or has a backup generator can also participate.

How does the Operating Reserve Market work? When there is an unforeseen increase in electricity demand or a sudden decrease in supply, the grid operator relies on the Operating Reserve Market to swiftly balance the system. Participants in the market may receive a call to curtail their electricity consumption or increase their generation to meet the demand. This real-time response helps maintain stability and reliability in the grid.

How many times will I get a call to curtail electricity? The frequency of curtailment calls can vary depending on grid conditions and individual participant capacity. On average, participants in the Operating Reserve Market receive around 23 curtailment calls per year.

How long do curtailment periods last? Curtailment periods can vary in duration based on the specific circumstances and grid conditions. Historical data from 2019 to 2022 shows that each curtailment period lasted between 1 and 71 minutes on average. It's essential for participants to be prepared to respond promptly during these periods.

Current rates for market participants The rates for participants in the Operating Reserve Market vary and are subject to market conditions. It is recommended to review the official website of the Alberta Electric System Operator (AESO) or consult with experts in the field for up-to-date information regarding the rates (link)

What is a typical simple payback for an onsite generator? The simple payback period for an onsite generator, considering participation in the Operating Reserve Market, can vary based on factors such as generator size, facility electricity consumption, and market conditions. On average, a typical simple payback period ranges from 3 to 7 years. This payback period takes into account the revenue generated from market participation and the savings gained through reduced energy consumption.

Aggregators for the Operating Reserves Market

Aggregators play a vital role in the Operating Reserve Market by facilitating the participation of multiple smaller resources. Utilizing an aggregator offers several benefits for participants. One significant advantage of using an aggregator is the reduced risk for market participants. Aggregators provide guarantees to the AESO, streamlining the participation process and minimizing individual participant exposure. Additionally, aggregators offer market insights, analytics, and expertise that can optimize participant performance.

Cost of using an aggregator The cost of using an aggregator can vary depending on the specific services provided and the size of the participant's operation. Participants should consider evaluating the benefits and value-add provided by the aggregator against the associated costs to make an informed decision.

Who should consider participating in the Operating Reserves Market? Industrial facilities, institutional facilities, commercial facilities, and anyone with the ability to curtail electricity with short notice or possessing backup generators should strongly consider participating in the Operating Reserve Market. Participation offers financial benefits, contributes to grid stability, and enhances the overall energy management of Alberta. In conclusion, the Operating Reserve Market in Alberta plays a critical role in ensuring the reliability and stability of the electricity grid. By participating in the market, entities can contribute to grid stability, optimize their energy management, and potentially generate additional revenue. Industrial, institutional, and commercial facilities, as well as those with the ability to curtail electricity or utilize onsite energy generation, should seriously consider taking part in this market.

Keywords: curtailment, onsite energy generation

Sources:

• Alberta Electric System Operator (AESO) - Official website: https://www.aeso.ca/

• Government of Alberta - Energy: https://www.alberta.ca/energy.aspx

• Energy Efficiency Alberta: https://www.efficiencyalberta.ca/

• Canadian Electricity Association: https://electricity.ca/

• Pembina Institute - Alberta Energy: https://www.pembina.org/our-work/energy