A capacity market pays resources for being available to produce (or to reduce consumption) in future periods of system stress, through auctions held years ahead, with penalties if they fail to deliver. An ancillary service is a service other than energy that the grid operator buys to keep the system secure: frequency reserves that respond in seconds to minutes, voltage support, and the ability to restart the grid after a blackout.
Quantitative Finance · Glossary
What is Capacity market, ancillary service?
Also known as: capacity market · ancillary service