In the deregulated power system environment, to maintain system security and power quality, ancillary services are obtained by the system operator in the ancillary service markets. Automatic generation control (AGC) is procured as an ancillary service in the electricity markets. On the other hand, with the development of new generation technologies, distributed generations (DGs) have been widely used in power systems. In this paper, we discuss the possibility of using DGs to provide AGC services. In a typical distribution system, assuming conventional thermal generators and distributed generators are used to provide AGC services in the ancillary service market, the optimal AGC capacity allocation is obtained by the proposed AGC dispatching model. The optimal results with and without DGs providing AGC services are compared from the economic point of view. Furthermore, we evaluate the control performances of various types of generators and allocate the compensation cost of the AGC services to them in proportion to their individual contributions for reducing the area control error (ACE). The simulation results show the technical possibility of using DGs to provide AGC services, hence the cost allocation results can encourage the generators to provide AGC services.
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Chen et al. (2007) studied this question.
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