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Effective control of spinning reserve can provide substantial cost reductions in large power systems. This paper suggests that this goal can he achieved by tightly integrating a probabilistic reserve assessment with the unit commitment (UC) function. This enables the reliability of individual units and the uncertainty of the load forecast to be considered for short-term scheduling. The generation can then be scheduled to meet a given risk index. It is further argued that the optimal value of this risk index should be selected on the basis of a tradeoff between the total schedule cost obtained from the UC solution and the expected cost of energy not served which can be derived from the probabilistic reserve assessment. Finally, the problem of over-commitment of reserve in Lagrangian relaxation based UC is reduced by means of a new unit decommitment technique incorporating a look-ahead feature.

The purpose of this paper is to contribute to the discussion over system and market operation issues in the context of the Brazilian electricity market. The paper presents a brief overview of the Brazilian market design and discusses some emerging challenges of the industry. It is focused on aspects regarding the merger of sub-markets. Issues like locational price signals, market power, economic efficiency and management of transmission constraints are revisited to assess the effects of the merger for final consumers. Case studies have been performed and the results are discussed.

This paper presents four alternative fixed cost allocation schemes to determine the spot prices of electricity in a centralised market with a complex bidding structure. Payment adequacy constraints are introduced in the pricing mechanisms to ensure that all generators recover their bidding prices. The numeric results show that by adopting different fixed cost allocation schemes, the total electricity prices and hence the customers' payments can vary significantly. Furthermore, different schemes yield significant changes in the generators' profitability. The issues discussed in this paper are illustrated using 10-, 26- and 110-unit systems.