GRID ARCHITECTURE ARTICLE 2:  Control & Market Structures in Grid Architecture

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GRID ARCHITECTURE ARTICLE 2:  Control & Market Structures in Grid Architecture

by Eamonn McCormickStuart McCafferty & David Forfia

"Control structures are an often overlooked vital aspect of Grid Architecture "  Jeff Taft creator of Grid Architecture

In this second article we introduce the concept of structures and, in particular, how structures such as control and markets need to operate in tandem.  The “ultra large scale complexity” of grid structures is what makes grid architecture unique, and also why we need to take a holistic view of the interdependencies discussed in these GRID ARCHITECTURE ARTICLE series.

Grid Architecture  was developed by PNNL for the DOE as a framework that the industry can use to solve its most pressing problem of transitioning to a cheaper, cleaner and more sustainable grid. An essential element of Grid Architecture is analyzing various grid structures. The concept of control is central to Grid Architecture and as the energy ecosystem becomes more and more distributed and intelligence at the edge becomes “normal”, architecting flexible, layered (or “laminar”) control is paramount to aligning grid operations with the reality of where things are headed.

Time is Not on Your Side

Control structures in the utility industry have several different time scales.  Market control structures operate at the week-ahead, day-ahead, hour-ahead time scales.  Reporting systems like meters and some DERs operate at 1 hour, 30 minute, 15 minute, and 5 minute scales.  Energy management systems operate at a variety of cycle times, but it is common for 5 second or 1 second cycles.  Real time systems operate at millisecond time scales.  Coordination and synchronization across these control loop time scales adds a difficult dimension to an already complex problem.

Figure 3: Example Architecture combing Markets & Grid Control Structures[1]

Understanding control loops and their interaction with markets is a very important aspect of Grid Architecture. One of the most important complicating aspects of Grid Architecture is that we need to integrate the physical control of the grid with the market processes focused on ensuring economic satisfaction of supply and demand. At least that is what happens as it relates to deregulated markets and even regulated utilities internally dispatch for example based on least cost economic considerations. The market gathers up diverse inputs and submit that to a market mechanism that also includes delivery constraints, environmental constraints, reliability constraints etc. 

Cascading latency is a key concern that needs to be considered in Grid Architecture. Cascading latency can prevent control loops from completing in time. Since there are different time scales and there are dependencies across devices using those different time scales, communications or processing latencies can cascade to other control assets.  This can create enormous and often hard to diagnose issues with reliability.  Grid Architecture structures must minimize the potential of cascading latency and look for dependencies and time scale issues that could create the cascading latencies.

The Grid is Complex!

Control is a very important concept in Grid Architecture because energy is a dynamic commodity that needs to be delivered when and where it is needed within the correct quality tolerance limits. Control is important in all complex physical industrial processes, but it is particularly challenging for electricity. Real Time control is required in Grid Architecture because the grid is a "physically synchronized distributed machine". This physical delivery control is further complicated through linkages to dynamic supply, demand, and market processes.

Figure 4:  The synchronous grid of Continental Europe[2]

When thinking about control at a macro level, we must recognize that our grid is a three-phase system with local, regional, national, and continental scales.  Our grid is tied together through interconnections that require synchronized utility frequency operation.  The same is true of other nations and territories.  In Europe, the interconnection consists of systems that serve 21 countries from Ireland to portions of the former Soviet Union and from the Baltic nations to portions of North Africa. On top of the synchronization requirement, grid control is further complicated by regional electricity trading markets, adding another dimension that requires local, regional, national, and continental coordination.  And, of course, electricity travels at approximately 1/100th the speed of light – so it is really fast and there are consequences if things do not happen on time!  Coordination and control of this highly complex system of systems IS NOT EASY!

Grid Architecture methodology considers these key control questions:

  1. What control is appropriate at different layers of the grid?
  2. How does top down and bottom up control relate to markets?
  3. What latency effects may impact control that may not be obvious?

Wide area synchronous networks improve reliability and permit the pooling of resources. These networks allow electrical systems to level out load, which reduces required generating capacity.  This, in turn, allows for more diverse power generation schemes, creates economies of scale for lower generation costs, and allows for more environmentally-friendly generation resources to be integrated into bulk power generation portfolios.

As complicated as this may seem, it is even more complicated now.  The bottom line is that our electric power industry has essentially worked as a top-down, centralized coordination and control paradigm for 100+ years.  We know what we are doing.  But, today’s grid is changing to introduce new, intermittent, small generation located close to the load.  We also have controllable loads where we can reduce demand when needed.  And, now we can even store energy using chemistry that can be located just about anywhere.  All of these capabilities have market value, even when there are currently not markets available to small owners of these assets at this time.  But, they are most certainly coming.  And, the introduction of distribution markets for small players to monetize their investments will complicate how we control the grid even more.  So, as we develop our Grid Architectures, we also need to work from the bottom up – from the edge in – and our control structures need to adapt to this type of ecosystem as well.

Markets Work Great Until They Don’t

The emerging energy grid will be characterized by convergence of markets and grid operations control.  This will include smaller, more local distribution markets that don’t exist today.  Today’s energy ecosystems only have efficient markets operations linked to grid control at the wholesale level. This model will almost certainly expand to lower levels of the ecosystem and will include new actors that include the Distribution Service Operator (DSO), Distribution Market Operators (DMO), Distribution Market Participants, and DER Asset Owners.  To enable this extension of the electricity ecosystem, where and how control is applied and how it merges and supports market processes at all levels must be thoughtfully considered. 

Figure 5:  Relationship of Control Structure, Market Structure, and Regulatory Structure[3]

The idea of combining grid markets and grid control is obviously not a new concept. It is, in fact, the foundational concept of the wholesale market systems conceived over thirty years ago.  However, it has not been consistently applied to the distribution, microgrids, and nano markets. The core problem the industry faces is how can we replicate the success of the Wholesale Markets at the distribution, microgrid and nano market level, while also accommodating the overall EnergyIoT and energy services cloud vision and meeting the needs of a sustainable energy future. PNNL’s Grid Architecture methodology is the first such thoughtful approach we have seen that clearly illustrates the relationships between the grid control structure and the market structure.

It is important to consider the control/market and economic impacts of these use cases and engineer, where possible, to ensure a fair and equitable markets for new and old players, while also protecting the overall service territory for electricity users.


[1] PNNL, Grid Architecture Training, Dr. Jeff Taft, 2019

[2] Wikipedia,, last edited on 10 October 2019

[3] PNNL, Grid Architecture Training, Dr. Jeff Taft, 2019


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