Auction Markets and Other Procurement Mechanisms for Demand Response Services

Ensuring a balance between the generation and demand is one of the most challenging tasks in power systems because of contingencies, sudden load changes, forecasting errors and other disturbances, occurring from time to time. The peak demand, which occurs only for a short duration, has always been a concern for independent system operators (ISOs), as it leads to high market prices and reliability concerns. Furthermore, in recent years there have been significant increase in penetration of renewable energy sources (RES) to reduce carbon dioxide (CO2) and other greenhouse gas (GHG) emissions and the power system's dependence on fossil fuel based generation.