In centrally-organized electricity spot markets, resources are scheduled and dispatched to meet anticipated demand plus a margin of operating reserves. When energy demand is met and operating reserves are maintained, the system is secure. At times, due either to unanticipated demand or resource outages, the system is in shortage and does not have resources available...
A multi-settlement market is a centrally-organized electricity market where physical electricity products are bought and sold initially on a forward basis and then resettled in relation to actual production and consumption in the real-time operating horizon. In the U.S. and in other parts of the world with advanced electricity markets, the forward market is organized...
Most spot electricity markets establish locational marginal prices (LMPs) that reflect the unique value of energy at each location or node on the network. Components of the LMP include the system marginal price, losses, and the cost of transmission congestion. When a transmission facility reaches its operating limit, higher-cost units must be dispatched instead of lower-cost...