Online Electricity Pricing from Frequency Measurements

Fuente: arXiv
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Hauptverfasser: Liu, Xinwei, Dvorkin, Vladimir
Format: Preprint
Veröffentlicht: 2026
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author Liu, Xinwei
Dvorkin, Vladimir
author_facet Liu, Xinwei
Dvorkin, Vladimir
contents Frequency dynamics in power systems reflect active power imbalance in real time, thereby providing an instantaneous signal to inform electricity pricing. However, existing real-time markets operate on much slower timescales and fail to exploit this signal. In this letter, we develop integrated market--frequency dynamics that enable online pricing directly from frequency measurements. Representing the real-time market as a dynamic price-discovery process, and integrating this process with the grid frequency dynamics, we derive an explicit price formation mechanism from frequency measurements. This mechanism manifests as a distributed PID-like controller for each generator, where frequency response is driven and remunerated by electricity prices derived solely from local frequency measurements.
format Preprint
id arxiv_https___arxiv_org_abs_2604_09931
institution arXiv
publishDate 2026
record_format arxiv
spellingShingle Online Electricity Pricing from Frequency Measurements
Liu, Xinwei
Dvorkin, Vladimir
Systems and Control
Computational Engineering, Finance, and Science
Optimization and Control
Frequency dynamics in power systems reflect active power imbalance in real time, thereby providing an instantaneous signal to inform electricity pricing. However, existing real-time markets operate on much slower timescales and fail to exploit this signal. In this letter, we develop integrated market--frequency dynamics that enable online pricing directly from frequency measurements. Representing the real-time market as a dynamic price-discovery process, and integrating this process with the grid frequency dynamics, we derive an explicit price formation mechanism from frequency measurements. This mechanism manifests as a distributed PID-like controller for each generator, where frequency response is driven and remunerated by electricity prices derived solely from local frequency measurements.
title Online Electricity Pricing from Frequency Measurements
topic Systems and Control
Computational Engineering, Finance, and Science
Optimization and Control
url https://arxiv.org/abs/2604.09931