ABSTRACT
In order for the de-regulated, competitive power market discussed in Chapter 11 to work, buyers and sellers must be able to move the power they have transacted from the point of production to the point of consumption. They need access to the transmission grid in order to do so. Thus, in every competitive power marketplace, some manner of assuring access to transmission usage is given to all users. In Poolco systems, this is not really an issue: The Poolco operator manages the interconnected power grid so that all users get power. But in other systems, including those with Power Exchanges and those that allow or encourage bi-lateral trading, the transmission grid must be available for use as needed by all users, on some equitable basis. Beyond this, however, the power grid must be kept operating. As is covered in Chapters 9 and 16, keeping the disparate parts of a grid interconnected, and functioning as a whole, is not an easy task. It requires considerable skill to balance the multiplicity of operating considerations, to keep equipment in synchronization and balance, and to anticipate in advance every contingency. Thus, in every de-regulated power system, a “System Operator” of some sort “drives” the system, keeping it on a sound operational basis, transporting the power that has been requested to be moved, and providing equitable access to all qualified users, according to the rules of its particular system. This chapter looks at the interconnected system, basically the power grid,
under de-regulation. Section 12.2 examines the evolution of the power pool operations center into the modern, de-regulated “system operator” and the various mechanisms used to implement that. Section 12.3 discusses the services actually being sold, or given, at the transmission level, including power transmission and ancillary services. Pricing methods for transmission, and several of the major issues involved in setting price, are discussed in Section 12.4. Section 12.5 discusses locational pricing, by far the most complex approach but one that appears destined to become best practice. Section 12.6 gives some final comments.
