Procuring and pricing performance‐based frequency regulation services in the electricity market.

This study presents a market model that procures energy and performance‐based regulation services simultaneously considering the participation of energy storage devices. The correlations of energy, regulation capacity, and regulation mileage are explicitly demonstrated. The proposed market model determines the energy schedule of generation units, charging and discharging profiles of energy storage devices, and the schedule of regulation services. Market clearing prices for energy, regulation capacity, and regulation mileage are derived and decomposed through Lagrange multiplier analysis. The relationships between the clearing prices of different market products are analysed. The proposed market model is tested and verified with the IEEE 30‐bus system. [ABSTRACT FROM AUTHOR]