North America has five regional grids comprised of numerous interconnected transmission systems. These are the Eastern, Western, Texas, Quebec, and Mexico Interconnects and they generally operate independently of each other. Within each interconnect, however, utilities, transmission owners, and generators are tied together in a linked network so that the actions of any one system operator can have strong impacts on the others within their grid. Each interconnect is divided into various control areas. And for each control area there is a system operator. System operators are also called control area operators or balancing authorities.
Functions of the system operator include:
- Forecast demand and supply availability in the day ahead
- Schedule supply to match forecasted demand
- Schedule reserves and other ancillary services
- Schedule use of the transmission system among various market participants
- Communicate schedules to neighboring transmission system operators so flows across interconnections can be anticipated
- Communicate schedules to distribution operators and load serving entities
- Manage the system in real time by correcting imbalances every few seconds
- Manage the transmission system in real time
- Correct any system disturbances that may occur
- Restore power should an outage occur
In some cases, system operators are responsible for ensuring long-term or annual supply capacity and for transmission planning.
System operators may be vertically integrated utilities, municipal utilities, federal power agencies, groups of utilities called power pools, or Independent System Operators (ISOs). ISOs are also sometimes certified by FERC as Regional Transmission Organizations (RTOs). Smaller utilities without a big enough system to warrant the cost of their own system operations often contract for the service with a larger neighboring utility, so control areas are often made up of multiple utilities. Some utilities have also banded together in groups called power pools that allow a pool of generators to be shared among utilities in order to optimize economic dispatch.
In areas where generation markets have been restructured, the system operations function is taken over by an ISO (in North America this has occurred to date in Alberta, California, Mexico, New England, New York, Ontario, Texas, and portions of the Mid-Atlantic, Midwestern, and Southeastern states), and the control areas become regional. Today North America has about 70 control areas that vary significantly in size. The smaller control areas manage less than 100 MW of generation while the PJM ISO manages over 180,000 MW of generation.