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The IESO is committed to a fair, competitive process to award ancillary service contracts. To receive additional information, please contact IESO Customer Relations at 905.403.6900 or customer.relations@ieso.ca.

Procurement Market

The IESO contracts for four ancillary services to help ensure the reliable operation of the power system: black-start capability, regulation service, reactive support and voltage control service, and reliability must-run.

Certified Black Start Facilities       

Certified Black Start Facilities help system reliability by being able to restart their generation facility with no outside source of power. In the event of a system-wide blackout, black start facilities would be called on during restoration efforts by helping to re-energize other portions of the power system.

Standard Terms and Conditions:         

  • Monthly fixed payments
  • Annual and monthly testing requirements
  • Payments may be reduced if the facility fails to pass tests or fails to perform during a blackout 

Regulation Service  

Regulation Service acts to match total system generation to total system load (including transmission losses) and helps correct variations in power system frequency. Response times may range from tens of seconds to a few minutes.

This service has historically been provided by generation facilities with automatic generation control (AGC) capability, which permits them to vary their output in response to signals sent by the IESO. Under the Market Rules, loads may also provide regulation service.

The IESO has taken a major step forward to increase the participation of alternative technologies such as aggregated loads, flywheels and battery storage in the electricity market. This has been accomplished by selecting three new suppliers of regulation service, a grid-balancing function traditionally provided by generators a first for Ontario.  Enbala Power Networks is the first of these suppliers, with its network of institutional, commercial and industrial consumers providing this grid balancing function.

Standard Terms and Conditions:

  • Minimum of ±100 MW of automatic generation control (AGC) must be scheduled at all times
  • Minimum overall ramp rate requirement for Ontario is 50 MW/minute
  • Payments comprise fixed and variable costs  

Reactive Support and Voltage Control Service    

Reactive Support and Voltage Control Service is contracted from generators and allows the IESO to maintain acceptable reactive power and voltage levels on the grid. Both active and reactive are required to serve loads. Reactive power flow is needed in an alternating-current transmission system to support the transfer of active power over the network. All generating facilities that are injecting energy into the IESO-controlled grid are required to provide reactive support and voltage control service in accordance with the Market Rules.

Standard Terms and Conditions:

  • Prices are based on the costs of providing reactive power.  Traditionally this includes the additional costs that occur as a result of energy losses during facility operation. Hydro-electric facilities that can provide speed-no-load and condense service may also receive additional payments if their service is required by the IESO to maintain system reliability.
  • Testing requirements are in accordance with North American Electric Reliability Corporation (NERC) Planning Standards 

Reliability Must-Run

Reliability Must-Run (RMR) contracts are used to ensure the reliability of the IESO-controlled grid. A RMR contract allows the IESO to call on the registered facility under contract to produce electricity if it is needed to maintain the reliability of the electricity system. RMR contracts obligate the market participant to offer into the IESO-administered markets the maximum amount of energy and operating reserve in a commercially reasonable manner and in accordance with stated performance standards. More information is available in Chapter 7, section 9.8.1 of the IESO's Market Rules.   

Costs and Quantities of Contracted Ancillary Services

Annually, the IESO publishes costs and quantities of all contracted ancillary services.

For the period from January 1, 2014 to December 31, 2014:

  1. Eight market participants were under contract to provide reactive support and voltage control service from a total of 59 generation facilities having 235 generation units.
  2. Four generating stations were under contract to provide certified black start capacity.
  3. Ten generating stations, two energy storage facilities and one load aggregation facility were under contract to provide regulation service. The total contracted capability was ±245 MW with typically ±100 MW of regulation service scheduled.
  4. The amount paid by the IESO for contracted ancillary services was $64,205,856.27. The portion paid for reactive support and voltage control service was $15,688,062.11.