In 2024, the AESO conducted a two-stage competition to procure Fast Frequency Response (FFR) services for the next term for when Alberta's electric system is interconnected. This period will commence no later than the long stop date of June 30, 2026, and continue until September 30, 2026, with an option to extend the term for up to two additional six-month periods.
The Request for Expressions of Interest (REOI) stage, which opened on January 29, 2024, and closed on February 20, 2024, assisted the AESO in identifying parties interested in participating in the competition. Information was provided on prospective facilities, and feedback was solicited on the product design, including the technical requirements, payment mechanism and the Fast Frequency Response Agreement.
The Request for Proposals (RFP) stage opened on March 26, 2024, and proposals were accepted until April 22, 2024. Contracts were awarded in Q2 2024.
The RFP attracted strong interest, and the AESO has contracted 603 MW of FFR from twelve service providers from various technologies including loads, energy storage and hybrid facilities at a weighted average arming price of $60.55 per MW-h.
The following table summarizes the FFR capacity contracted by the AESO, detailing existing assets and the expected online capacities by the end of 2024, 2025, and 2026.
The AESO hosted a virtual information session on February 1, 2024, from 10 a.m. to 12 p.m.
Purpose
The information session kicked off procurement for FFR when the system is interconnected. The Request for Expressions of Interest (REOI) stage will assist the AESO in identifying parties interested in participating in the competition. At the information session the AESO:
- Provided key information to stakeholders on how to participate in the procurement.
- Discussed the REOI requirements and timelines.
- Provided an update on anticipated ISO rule revisions.
Materials
The Agenda, Draft FFR Agreement, REOI and other resources are in the Materials section (upper-right corner of this page).
The AESO hosted a virtual information session on December 13, 2023, from 10 a.m. to 12 p.m.
Purpose
Following market-sounding meetings and consideration of the feedback provided by stakeholders, the AESO hosted a virtual information session to:
- Review input received on product and procurement design
- Share the FFR product design decision and obtain final comments
- Discuss timelines and next steps for the procurement process
Materials
The agenda, presentation and audio file are in the Materials section (upper-right corner of page).
The AESO conducted a second round of market sounding to seek feedback on Proportional FFR from a cross-section of stakeholders (e.g., importers, providers of contingency reserves, internal generators, energy storage and loads) on FFR product design options discussed at the Stakeholder Session on October 5, 2023.
Parties interested in participating in the FFR market sounding were invited to contact us at FFRServices@aeso.ca. Feedback specific to Proportional FFR through Round 2 meetings and/or the submission of Feedback Form(s) was requested by end-of-day Monday, October 30, 2023.
The AESO hosted a virtual stakeholder session on October 5, 2023, from 1 p.m. to 3 p.m.
Purpose
This session provided additional information on:
- Transferred Frequency Response services effective September 1, 2023
- Product design that enables pool participants to provide both Fast Frequency Response (FFR) services for market access and spinning reserves
- Other potential FFR products being contemplated to further enable market access
Procurement for FFR services is expected to commence in early 2024.
Round 1 Market Sounding meetings were conducted between June 2-26, 2023, and key themes that emerged include:
- Strong interest in participating in future Fast Frequency Response services
- Battery Energy Storage Systems and hybrid generation can satisfy high-level technical requirements
- Long equipment lead times and AESO connection process risk delaying commercial readiness of new projects (require start date flexibility)
- Project viability remains uncertain depending on revenues and costs, including Demand Transmission Service costs
- Financial close requires greater technical and commercial certainty of future FFR services
- Longer-term contracts will lower the annual cost of service
Identification of Prospective FFR Service Providers
The AESO identified market participants with technologies that can provide a proportional or discrete FFR response by 2025. Parties that met our minimum Eligibility Requirements, as defined below, were invited to participate in one-on-one meetings to:
-
Discuss and solicit feedback on potential:
- FFR product design options, including potential technical and commercial requirements, being considered by the AESO.
- FFR procurement design options being considered by the AESO.
-
Understand which assets (and associated volumes) may be capable of providing an FFR service by early 2025.
Eligibility Requirements
As noted in the AESO 2023 Reliability Requirments Roadmap, we have prioritized the procurement of Fact Frequency Response services as one of our near-term action plans to ensure frequency stability. We sought the input and expertise of industry partners to explore potential FFR procurement and product design options. Market participants were requested to review the following requirements carefully to determine if they were eligible to participate in our first round of market-sounding meetings:
- You have a current or future pool asset located within the Alberta Balancing Authority Area.
- You are a market participant that may be able to provide FFR services by 2025.
-
You manage--or anticipate managing--energy storage, hybrid generation or other assets that can meet the following minimum technical requirements, which include providing:
-
Discrete or proportional power response based on under-frequency detection.
- Discrete response | Fixed volume response within 18 cycles (0.3 seconds) following under-frequency detection reaches 59.6 Hz.
- Proportional response | Variable response, with power output in direct proportion to the magnitude of the frequency deviation.
- Continuous response for one hour following under-frequency detection.
- Under-frequency relay detection and event recording technology.
-
Supervisory Control and Data Acquisition (SCADA) system.
If they were able--or expected to be able--to meet these eligibility requirements, market participants were invited to contact us at FFRServices@aeso.ca(External link) by June 9, 2023, to schedule a meeting no later than June 14, 2023.
The AESO thanked all interested parties; however, due to our expedited schedule, we only engaged with parties that met our eligibility requirements.
Feedback received from participants during these market-sounding meetings was aggregated and shared with industry (please see Key Themes above).
Interconnected FFR Agreement (589 KB) (pdf)
Bonfire Materials
