Notes:
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The real time correction of balance deviations due to load prognosis, power plant outages and noise fluctuations has existed for the last fifty odd years. The utility companies were generally totally integrated and consequently these problems were resolved internally.<br/>The advent of the unbundling of the market introduced separate organisations to handle generation, transmission and operation and this exacerbated considerably the problem. Local market rules dealing with financial consequences, legal requirements and system constraints have also added to the complexity.<br/>In a liberalised electricity market system balancing consists of two major elements:<br/><ul> <li>system control and</li><li>imbalance settlement (defined in IEC 62325-451-4)</li></ul> To correctly handle load/generation balance prognosis it has become essential to exchange an ever-growing amount of information between all involved parties. Amongst the primary requirements is the necessity to provide for energy reserves in order to respond to unexpected events to keep the electricity system operational. <br/>The former ETSO Task Force Balance Management (TF BM) has developed several contractual models which describe how the trading of balancing services across borders could be facilitated. This section provides an overview of two of these models, covering the roles and responsibilities of each participant. The involved participants are the Resource Providers (RP) and the System Operators (SO).<br/>The principal role in these models is that of a Resource Provider which is defined as "<i>A role that manages a resource object and provides the schedules for it". A Resource Object is defined as being "A resource that can either produce or consume energy and that is reported in a schedule". </i><br/>The main principle behind Model 2 is that System Operators will contract for the provision of balancing services to each other. Each System Operator will then be responsible for taking the necessary action in his own area to deliver the balancing service to the other System Operator. <br/>
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