A wholesale competitive electricity market started operation in Spain on January 1st, 1998. It is based on a non mandatory pool system, since physical bilateral contracts between generators and large consumers can be freely established. This paper presents the adopted approach to integrate economic and security functions in the new market. The essence of this approach is a hierarchy of markets for specific types of transactions, which take place in a prescribed sequence, zooming from a day in advance to the real time. The paper describes in detail each one of the markets: daily, constraints management, ancillary services, intra-daily and real time, focusing on the interplay between the economic and security objectives, and showing that both can be jointly approached with market mechanisms in most cases. Provisions for special and emergency conditions have been made, whereby the System Operator may exceptionally overrule the outcome of themarket. The paper also presents the available experience with this approach since its implementation.
Bulk Power System Dynamics and Control IV-Restructuring. Santorini, Greece. 24-28 Agosto 1998.
Published: August 1998.