Automatic generation control in deregulated environment

Automatic Generation Control (AGC) is a process used to regulate the output of power plants to meet changes in electricity demand; In a deregulated environment, the traditional centralized control of the power system is replaced by market-based operations, where individual generators compete to sell electricity to the grid; AGC in this context plays a critical role in ensuring power system stability and maintaining the balance between electricity supply and demand; AGC algorithms take into account various factors such as real-time pricing, economic dispatch, and the integration of renewable energy sources; Advanced control techniques and smart grid technology are also employed to improve the efficiency and effectiveness of AGC in deregulated power systems; The role of Independent System Operators (ISOs) and Energy Management Systems (EMS) is also crucial in facilitating AGC in a deregulated environment.

the framework of electricity utilities all over the world has undergone significant changes. Also, electric power companies face many challenges  due to the increasing electricity demand. It is very critical in power systems that  

electrical energy should be delivered to consumers with reasonable quality and reliability.  

The conventional way of supplying electricity has been through vertically integrated utilities 

which are regulated in all their operations i.e., generation, transmission, and distribution by  

legal  monopolistic  entities.  Such  firms  were  closely  supervised  by regulatory  

agencies or under strict political supervision. Electricity utilities have been under 

pressure from 1970s, for a variety of reasons, such as the oil crisis, increased demand, increased 

environmental impact, speculation of a  relationship  between  the  industry  and  its  

regulators,  and  evolving technology. Weak planning and environmental practices, price  

spikes, and high construction costs of hydro, coal and nuclear power plants have also 

been reported.

Traditional business systems have opposed innovative energy-saving initiatives or the creation of 

small-scale renewable energy technologies and consumers have very few options available. Customers 

are required to pay an average tariff in a vertically integrated system, as it is often  

difficult to distinguish the costs involved in production, transmission and distribution. 

The industry has therefore been vulnerable to transition and the system, and all its functions,  

remained the same for several years, within a certain

geographic region controlled by a monopoly.