![]() ![]() LSEs also utilize some generation facilities to provide "ancillary services," which represent very fast (sub-second to minutes) automatic adjustments to keep supply and demand in balance. DispatchĬlose to the real-time point of consumption (i.e., minutes ahead of real time), LSEs issue dispatch orders to existing generation facilities, setting specific output levels for each. ![]() If demand were to deviate wildly (and unexpectedly) from the utility's forecast, it would be faced with the decision of curtailing output from some of its generators (if it over-estimated demand) or utilizing generators with fast start times but high costs (if it under-estimated demand). The utility would, weeks in advance of consumption, have to commit to using a given mix of generation resources. This decision is referred to as the unit-commitment decision, and it is aptly named. They would need to look at the demand forecast over that period of weeks and decide the lowest-cost mix of generation plants that would meet the demand. #DISPATCH DEFINITION GENERATOR#A utility would need a forecast of demand weeks in advance before turning on a generator with a long minimum run time. Instead, their operation must be scheduled over a longer time horizon of days or even weeks. Generators with large start-up costs or long minimum-run times (such as large combustion turbines and nuclear power plants) cannot run optimally if their output is determined using a single-period analysis (a "period" in the electric power industry usually refers to a length of time of about an hour). ![]() The decision to commit a generating unit to be able to produce electricity means that the utility is willing to incur fixed costs related to unit startup in order to have that generating plant ready and available to produce electricity in real time. In some cases (such as nuclear plants or hydroelectric facilities), the commitment decisions are made many weeks or months in advance. Utilities operating in states that have by and large retained the regulated and vertically-integrated structure submit resource plans to their respective state regulatory commissions through a process known as "integrated resource planning." Generation unit commitmentĭays to hours in advance, utilities make "commitment" decisions to have certain quantities of existing generation plant available to produce electricity when the need arises. Construction of new generation plants typically needs to happen years in advance, while forward and spot market contracts may be signed for periods varying from years in advance to a day or hour in advance. Resource planningĭays to years in advance, utilities have acquired stores of electric generation capacity through several mechanisms including the construction of new generation plants (and supporting transmission lines), long-term forward contracting, and smaller quantities of spot-market purchases. The sections below discuss each of the three stages under the assumption that all relevant plans and actions are undertaken by a regulated vertically-integrated electric utility. Except in circumstances where regulations have prohibited such actions, the electric utility industry has historically broken the process of meeting customer demands into three stages. Economic Dispatch and Operations of Electric UtilitiesĮlectricity is a unique commodity in that it cannot generally be stored at a large scale at reasonable cost, so the entities that operate the transmission grid need to make plans and take actions to keep supply and demand matched in "real-time" - from minute to minute and second to second. ![]()
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