Replacement Reserve for the Italian Power System and Electricity Market

Over the last years, power systems around the globe experienced deep changes in their operation, mainly induced by the widespread of Intermittent Renewable Energy Sources (IRES). These changes involved a review of market and operational rules, in the direction of a stronger integration. At European level, this integration is in progress, driven by the new European guidelines and network codes, which deal with multiple issues, from market design to operational security. In this framework, the project TERRE (Trans European Replacement Reserve Exchange) is aimed at the realization of a European central platform, called LIBRA, for the exchange of balancing resources and, in particular, for the activation of the procured Replacement Reserve (RR) resources. The Italian Transmission System Operator (TSO), TERNA, is a participant of the project and it is testing new methodologies for the sizing of RR and its required activation throughout the TERRE process. The aim of the new methodologies is to find areas of potential improvement in the sizing of RR requirements and activation, which open up the possibility for a reduction of the procurement cost, without endangering the security of the power system. This paper describes a new RR sizing methodology, proposed by TERNA, which is based on a persistence method, showing its results on real data and highlighting key advantages and potential limitations of this approach. In order to overcome these limitations, a literature review on alternative approaches has been carried out, identifying nowcasting techniques as a relevant alternative for the very short term forecast horizon. These one could be further investigated and tested in the future, using the proposed persistence method as a benchmark.