Introduction to Deregulation in Power Industry - nptel

8. Major Responsibilities of ISO
The independent system operator (ISO) is the central entity to have
emerged in all deregulated markets with the responsibility of ensuring system
security and reliability, fair and equitable transmission tariffs and providing
for other system services. With differing market structures evolving in various
countries, it has been noticed that based on the responsibilities assigned to
them and their functional differences, ISOs could be placed in two categories.
The first and the most common one is the pool structure in which the ISO
is responsible for both market settlement including scheduling and dispatch,
and transmission system management including transmission pricing, and
security aspects. Here, ISO is also known as Poolco Operator.
The other structure is that of open access, one dominated by bilateral
contracts. In this system, bulk of the energy transactions are directly organized
between the generator and the customer, and the ISO has no role in generation
scheduling or dispatch and is only responsible for system operation. The role
of ISO is minimal and limited to maintenance of system security and
reliability functions.
In any market structure, the ISO has following basic functions laid out for
it:
• System security: Operator must assure that the power system continues
to operate in a stable, economical manner.
• Power Delivery: The operator should provide the power transportation
services requested of it by buyers and sellers.
• Transmission pricing: System operator must determine and post the
prices for transmission usage, offer to reserve or sell usage, track, bill
and settle with users, and pass on revenues to transmission owners.
• Service quality assurance: The system operator must assure the quality
of service it provides.
• Promotion of Economic efficiency and equity: The overall operations
of system operator should obey economic efficiency and also it should
have fairness and equity in it’s dealing and should not benefit only
some players in the system.
The system operator faces many daunting challenges in performing them.
But it has many resources, including a large staff of experienced power system
operators and engineers, a fully computerized control centre, and a massive
remote data collection system to monitor, analyze, and control the power
system.
9. Issues Involved in Deregulation of Power Industry
9.1 Network congestion
9.1.1 Problem definition
When the producers and consumers of the electric energy desire to
produce and consume in amounts that would cause the transmission system to
operate at or beyond one or more transfer limit, the system is said to be
congested.
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