◊ This is part of the ‘Electricity Generation’ series of articles ◊
Grid connected energy resources are referred to as supply. The electrical load on the grid is referred to as demand. Supply must always meet demand at any point in time to ensure stability. Supply capacity in the form of reserve must be available to ensure operational reliability. Specific measures as defined by reliability authorities must be in place to ensure security of supply. A region-specific Balancing Authority ensures that the supply and demand requirements are met.
Supply
In the most general sense, generation must be capable of safely supplying the demand of electricity consumers with the necessary reliability and power quality at an economically acceptable cost. Environmental impact is an increasingly relevant geo-political factor which must also be considered. Many requirements for supply and generation are imposed through mandatory reliability standards. Jurisdiction-specific laws, statues and standards apply to grid-connected supply.
Capacity and energy
Grid supply capacity may be the sum of the instantaneous power (watts) supplying the grid at a point in time, or the sum of generators’ rated capacity, depending on the desired context.
Energy supply is mathematically the integral of power over time with the standard unit of watt-hour. A generator that produces 1 watt of power for one hour produces 1 watt-hour of energy.
There are other relevant terms used within the industry related to capacity as follows.
Real power
Supply capacity may be expressed as real power, with the units of watts (W). On a power grid, the magnitude of real power is large and usually expressed as mega-watts (MW).
For additional information on power please see the Some Physics article.
Reactive power
Reactive power is a product of the voltage and current requirements of capacitance and inductance on the grid with the unit of volt-amp reactive (VAR). On a power grid, the magnitude of reactive power is large and usually expressed as mega-volt-amp reactive (MVAR).
Reactive power does not produce real work, but simply oscillates back and forth between the supply and the reactive element.
Apparent power
Supply capacity may be expressed as apparent power, with the units of volt-amps (VA). On a power grid, the magnitude of apparent power is large and usually expressed as mega-volt-amps (MVA).
Power Factor
The term power factor (PF) may be used to describe both supply and load characteristics. It is expressed as a ratio of real and apparent power. Additional information on power factor please see the Some Physics article.
Rated capacity and capacity factor
A generator has a rated output capability specified by the manufacturer in accordance with industry standards. Generators do not operate continuously at rated output for different reasons including thermal limitations, fuel availability, outages and dispatch criteria. Capacity factor (CF) is a measure of how much energy a resource actually produces compared to its continuous rated output capability and is typically expressed as a percentage based on annual data. Capacity factor is usually expressed as a percentage and will be less than 100.
A generator that operates at full rated output for 12 hours a day, every day for a year has a 50% capacity factor.
Available generating capacity
The reliability authority calculates ‘available generation’ during peak demand periods to assess supply adequacy. Available generation according to the IESO’s ‘Methodology to Perform the Reliability Outlook’ includes:
- thermal and nuclear capacity (less planned outages)
- historical median contribution of hydro, wind and solar during peak demand hours
- effective capacity of projected demand measure resources (distributed resources and dispatchable loads)
Available generation capacity is always less than the sum of grid connected generation rated capacity due to generator limitations and grid constraints.
Reserve capacity
Operating reliability requirements drive the need for the supply to include reserve capacity above peak grid demand. Reserve capacity is used to manage single contingency grid failures as defined by the reliability authority. Reserve capacity is provided by generation which is either available immediately or within a short period of time. Immediate capacity is synchronized to the grid (spinning reserve) and available in a 10 minute window. Additional reserve capacity can be considered if available within a short period of time (10 to 30 minutes) without the requirement of being synchronized.
Supply mix
The supply of electricity to the grid is provided by thousands of generators operating in parallel at various times. Supply can be characterized by the generator’s primary energy source. In Ontario, the breakout of energy by fuel is provided by the Independent Electricity System Operator (IESO) on an hourly basis (figure 1). This is called the supply mix.

Demand
Demand is the sum of instantaneous loads (watts) or energy (watt-hours) on the grid. Demand can be further broken down into base, intermediate and peak as in figure 2.

Stability
Stability is a steady-state condition where grid voltage and frequency are maintained within required limits, balancing supply and demand. The grid must withstand transient disturbances as prescribed by standards adopted by each jurisdiction to remain stable.
In Ontario the tolerances for normal operation are listed along with the applicable standards here.
Reliability
Reliability can be expressed using many different terms, each having its own measure. The industry-accepted terms and measures are defined in standards which have been developed by reliability authorities.
Grid reliability standards are set by the North American Electricity Reliability Corporation (NERC)
The North American Electricity Reliability Corporation (NERC) defines reliability using the terms resource adequacy and operational reliability.
- Resource adequacy requires the grid to have sufficient capacity to supply load at all times.
- Operational reliability requires the grid to be capable of withstanding disturbances like short circuits or the loss of system elements (including generators).
Generator reliability is measured by gathering operational data. The data is used to calculate reliability indexes (NERC Bulk Power System Severity Risk Index – SRI) and available generating capacity. The specific calculations can be found through NERC and the regional reliability authorities.
Security
Security is directly related to reliability although specific requirements apply to cyber and physical aspects of the bulk power system (BPS). In the case of generation which is deemed impactive on BPS reliability, strict standards defined by NERC must be met. For more information, refer to the NERC Reliability and Security Technical Committee (RSTC).
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Derek
