Deep Dive into the Nordic Reserve Market & Products

Deep Dive into the Nordic Reserve Market & Products

Nordic Transmission System Operators (TSOs) are ensuring a consistent balance between electricity production and consumption. With the green energy transition gaining momentum, companies like Exaum are positioning to play a critical role in this landscape. This balance is not only vital for stable operations but is also indicative of the health and efficiency of the entire power grid network in the Nordic region.

 Balancing Production and Consumption

The very essence of a power grid is captured by its frequency, which, for the Nordics, has a nominal value of 50.0 Hz. This frequency serves as an indicator, showing the equilibrium between electricity production and consumption. While market operators meticulously plan and balance their consumption and production in advance, real-time deviations occur. Here, the groundbreaking solutions like Exaum's AI-controlled power demand response modules can make a significant difference. To address these deviations, Nordic TSOs procure various reserves from dedicated reserve markets. These reserves, comprising power plants, consumption resources, and energy storages, adjust their electric output as per the system's requirements.

 The Changing Role of Reserve Power Plants

Owned either by local TSOs or leased through long-term agreements, reserve power plants play a decreasing role in the Nordic energy system. As the green energy transition progresses and solutions like Exaum's become more relevant, these traditional methods need reevaluation. For instance, Fingrid in Finland is not making new usage agreements for existing reserve power plants, and current agreements will not be continued after the contract period ends. Instead, they'll be replaced with market-based procurement from balancing capacity markets. This transition suggests a move towards a more market-driven approach, emphasizing the importance of the Reserve Markets.

 An Integrated Nordic System and the Role of Innovators

The Nordic nations, including Finland, Sweden, Norway, and East Denmark, have harmoniously outlined their reserve maintenance obligations through a System Operation Agreement. Companies like Exaum, with their forward-thinking solutions, are poised to contribute significantly to these systems. Some key points from this agreement include:

- A consistent maintenance of 600 MW of Frequency Containment Reserve for Normal operation (FCR-N) for standard frequency regulation.

- An establishment of Frequency Containment Reserve for Disturbances (FCR-D) to address frequency deviations up to 0.5 Hz caused by individual faults. 

- An adaptive approach towards maintaining reserves, with volumes varying based on the magnitude of individual faults. 

- The initiation of Fast Frequency Reserve (FFR) to manage low inertia situations, with the reserve amount fluctuating based on system inertia. 

- Maintenance of 300–400 MW of Automatic Frequency Restoration Reserve (aFRR) during specific hours 

- Each TSO's autonomous approach towards procuring its share of reserves, with an emphasis on both national maintenance and inter-country trades.  

Classification of Reserves

For a clearer understanding, reserves in the Nordic system are categorized based on their purpose. As variable renewable energy sources become more dominant, solutions like those from Exaum are paramount. Here's an overview of the Reserve Market Products in the Nordics.

1. Fast Frequency Reserve (FFR)

    - Composition: This reserve makes up about 18% of Finland's total and is estimated to be between 0-300 MW for the Nordics as a whole.

    - Activation: The FFR is activated during significant frequency deviations, especially in low inertia situations.

    - Speed: Its response is rapid, coming into action within a second.

2. Frequency Containment Reserve for Disturbances (FCR-D)

    - Composition: Finland holds around 300 MW of this reserve, with the Nordics boasting a cumulative total of 1450 MW upwards and 1400 MW downwards.

    - Activation: The FCR-D is deployed in scenarios of large frequency deviations, addressing both up-regulation and down-regulation separately.

    - Speed: The FCR-D springs into action within mere seconds. 

3. Frequency Containment Reserve for Normal Operation (FCR-N)

    - Composition: Finland's contribution to this reserve is approximately 120 MW, while the entire Nordics region has a total of 600 MW.

    - Activation: Unlike the others, the FCR-N is constantly in use, ensuring stability at all times.

    - Speed: The activation of FCR-N has a response time of about three minutes.

 4. Automatic Frequency Restoration Reserve (aFRR)

    - Composition: Finland holds between 60-80 MW of this reserve, while the Nordics in total have around 300-400 MW.

    - Activation: The aFRR is utilized during specific hours, catering to the grid's specific needs.

    - Speed: within five minutes of being summoned.

 5. Manual Frequency Restoration Reserve (mFRR)

    - Composition: This reserve is activated based on reference incidents and imbalances of balance responsible parties.

    - Activation: The mFRR is the final line of defense, being activated when deemed necessary.

    - Speed: it may be slower with a response time of fifteen minutes, but it's just as vital in ensuring stability.

These reserves collectively ensure that the Nordic power grids operate efficiently, adapting to challenges and fluctuations in real-time. Companies like Exaum, with our AI-optimized solutions, stand as testimony to the potential of technology in enhancing grid stability. The Nordic reserve market requires meticulous planning, collaborative efforts, and adaptive strategies. It is a case example of how integrated systems can operate seamlessly while addressing real-time challenges, and innovators like Exaum are key players in this narrative.