Role of the ISO/RTO?

[nLite]

Hi all,

I've been reading up on power transmission and what not and I'm a bit confused on what the role is of some of the organizations that control power transmission, in particular the ISOs/RTOs.

Obviously, there's the two that everyone is familiar with:
1. Electric power customer - buys electric services from power companies
2. Power company - provides services to customers and ensures that power is stable.

And then there's the ISO/RTO, which apparently doesn't own any power generation but some how sells it? I guess my main question is how does the System Operator interact with the power companies. It seems to me that the ISO/RTO has a larger role than the power company in ensuring that power is stable, but who does it buy power from to make sure of that? where does it get the money to buy that power?

 

[davenn]

hi there

since you havent stated what country you are in
its a bit difficult to give you meaningful answers

Dave

 

[nLite]

Right, I live in the US. I forgot that power systems operate under different infrastructures.

 

[(*steve*)]

It's the same as food.

Farmers/farming companies make food.

People buy and eat food.

Retailers buy the food from the farmer and sell it to the people.

It is more efficient for the farmer to sell to a few large retailers, so they get a good price. The retailer has to cover the cost of selling to individual customers and charges accordingly.

In theory this is better for everyone. In practice someone (usually the middleman) finds a way to screw the producer and the consumer.

 

[nLite]

So are you saying that farmers are the power companies and retailers are the System Operator? It seems to me that customers have no interaction with the System Operator.

Or if you're saying that farmers are the System Operator and power companies are the retailers, I was under the preconception that System Operators don't produce power.

I've been seeing in literature about regulatory and contingency reserves that System Operators purchase these reserves (not sure from who or what) to account for expected/unexpected changes in generation & load. I'm having trouble incorporating this idea into the bigger picture.

 

[(*steve*)]

I was assuming that whatever ISO/RTO stand for that they are the entity that purchase the power from the producers and sells it to the consumers.

Where I live there are many producers of power (from large coal fired base generation to gas turbines for peaks, and a plethroa of solar installations (down to 1.5kW) and industrial sources of power).

The retail power companies purchase the power from each of these and provide a simplified method for consumers to be billed.

The largest of consumers can deal directly with a producer, but we're talking about prodigious consumers of power.

It may be different where you are.