Interdependencies of harmonised procurement of manually and automatically activated FRR in selected Central European balancing markets

Abstract

High shares of renewable electricity generation requires robust balancing measures and procedures in the electricity system. There are several electricity balancing pilot projects having already been started or will start in the near future. The work presented in this paper focuses on projects with the geographic scope of Central Europe. This includes the common activation of automatic Frequency Restoration Reserve (aFRR) in Austria and Germany as well as the common procurement of aFRR in the above-mentioned area, which is planned to start mid-2017. The start for common procurement and activation of manually activated Frequency Restoration Reserve (mFRR) has not yet been published, but will also be analysed within this work. In addition, the impact of a further extension of the common balancing area to Belgium and The Netherlands is analysed. The focus of the study is on how common procurement of aFRR and mFRR influences wholesale electricity market clearings and how it interferes each other. The quantitative results confirm that common procurement of balancing capacity (aFRR and mFRR) in the simulated region has significant advantages in terms of cost reduction, CO2 emissions and increased flexibility in the electricity system. Furthermore, the common procurement of mFRR interferes the procurement costs of aFRR in a positive way, meaning that further reductions can be achieved.