Ancillary Services in ERCOT are a huge part of the revenue stack for battery energy storage systems. But what happens when these services are deployed? For most Ancillary Services, the amount of capacity that a resource operator or a Qualified Scheduling Entity is expected to deploy is based on the proportion of total responsibility for that service that they've been awarded. And deployment falls into two categories: generation increase or decrease and release of capacity to the economic dispatch.
In the first bucket, we have regulation up and down. As frequency moves above or below 60hz, ERCOT deploys each of these services.
Imagine that ERCOT has procured two 50 MW of Regulation Up for a given operating hour, and you've been awarded 50 MW or 20% of that. If ERCOT is currently deploying 200 MW of Regulation Up, you'll be expected to provide 20% or 40 MW of that total. This means the operator is simply expected to increase the output of their resources with regulation up responsibility by 40 MW.
In the second category, release of capacity, we have ECRS, Responsive Reserve, and Non-Spinning Reserve. When these services are deployed, the operator's resources have to make some or all of their reserve capacity available for the economic dispatch.
It's important to note that when capacity is released, resources do not immediately increase their actual output. For example, say ERCOT procures 2000 MW of ECRS and you've been awarded 200 MW or 10% of that. If ERCOT deploys 1000 MW of ECRS, then you're expected to provide 10% or 100 MW of that.
Let's say you've placed all 200 MW of that ECRS responsibility on one 250 MW battery. When you receive your deployment instruction, you adjust the battery's telemetry to show that one hundred megawatts of its ECRS responsibility has now been released to the economic dispatch, or SCED. At this point, SCED treats the 100 MW of release capacity as regular energy in the offer stack. This means that your battery is still dispatched according to its energy offer curve. As a result, SCED may not even use your release capacity if it can meet the grid's demand via cheaper resources.
While the mechanics of when deployment happens are different for RRS, ECRS, and Non-Spin, this release of capacity is consistent across all of them. To find out more about how Ancillary Services work in ERCOT, read the rest of the article now and check out our explainer on when ERCOT deploys Ancillary Services.
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