Day-ahead market structures for co-optimized energy and reserve allocation

In this paper we propose market designs that incorporate the beneficial method of co-optimization to the European energy markets with predominantly sequential energy and control reserve procurement. Co-optimization refers to that reserves are procured and priced jointly with the energy in the same market clearing algorithm. We found that different day-ahead market designs can be formulated, all achieving a co-optimized power exchange (PX) complying with the price-based market coupling process, described as part of the IEM targets.