Like a prayer: frequency market incentives

The confirmation that I-SEM will finally go live on 1 October this year finally arrived this week. The news turned our thoughts to how the new market will incentivise the correct market dynamics to ensure that I-SEM delivers value.

Amove away from a dispatched network to a hybrid model between price nomination and dispatch. This will see generators dip their toes into the murky waters of balancing for the first time.

The key to a balanced and low-cost network for the Irish energy sector will be ensuring that I-SEM and DS3 get the reward structures right. DS3 will use scalars (multipliers) to attempt to capture added value in frequency management for the grid.

This week’s blog looks at why they might do this, what benefit it can bring and asks whether DS3 will get it right?

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