Operating Ancillary Service Markets in ERCOT

Summary form only given: When the ERCOT market first opened in July 2001, ERCOT implemented a sequential procurement process for ancillary services which procures four ancillary services (regulation up, regulation down, responsive reserve, and non-spinning reserve). In September 2005, ERCOT modified the procuring process to simultaneously procure all the ancillary services in the day-ahead, with the objective to minimize the overall ancillary service procurement costs. Currently ERCOT is in the transition from a zonal type market to a nodal type market. In the future nodal market, ERCOT will co-optimize in day-ahead the procurement of ancillary services, energy, and CRR offers/bids. In the adjustment period, the ancillary service capacity sufficiency and its deliverability will be evaluated; if needed, a supplemental ancillary service market will be run to procure additional ancillary services to ensure system reliability.