Power system reliability issues in power market environment

It is vital to carefully consider the impact on power system security and reliability when the existing structure of electric power industry is transferred into a competitive power market model. First, generation related reliability criteria are complemented, supplemented or even replaced by energy market prices and commercial performance incentives. Secondly, how we meet reliability standards in a large integrated power system open to competition is quite different from how we met them when we operated in the traditional power industry. Thirdly, the ancillary service is an important measure to maintain reliability. How to define and price it must be carefully considered. At last, relay protection and security control systems will face new issues such as how to set relay protection systems in the deregulated system. This paper introduces these important issues and challenges. Suggestions for revising the security and reliability codes of power systems are also presented.