Project Scope:

Strategic advisory support to review and harmonize methodologies for determining Planning Reserve Margin (PRM) and Operational Reserve Margin (ORM) in a rapidly transforming power system.

The assignment addressed key structural changes, including:

• Rapid expansion of Solar PV capacity (from ~2.5 GW to >10 GW by early 2030s)
• Commissioning of 5.6 GW nuclear capacity
• Decoupling of power and water production via Reverse Osmosis
• Divergent planning and operational adequacy approaches (stochastic vs. deterministic; islanded vs. interconnected assumptions)

The project aimed to align long-term investment planning (PRM) and short-term operational adequacy (ORM) methodologies to ensure coherence, robustness, and regulatory soundness.

This engagement covered Phase I: Problem Definition & Risk Assessment, structured into five work packages.

Key Responsibilities & Achievements

1. Project Initiation & Data Validation

• Led kick-off workshops and stakeholder consultations.
• Collected and validated technical, regulatory, and modeling data.
• Delivered an Inception Report detailing scope refinement, methodology, and risk identification.

2. Review of Current ORM/PRM Methodologies

• Assessed existing definitions, assumptions, and calculation approaches for ORM and PRM.
• Analyzed differences between planning (stochastic adequacy, islanded assumption) and operational (deterministic, interconnected) frameworks.
• Reviewed legal, regulatory, and governance structures impacting reserve margin definitions.
• Identified methodological inconsistencies and interdependencies between planning and operations.

3. International Benchmarking & Gap Analysis

• Screened international benchmark systems facing comparable high-RES and structural transition challenges.
• Selected and analyzed two relevant benchmark cases.
• Conducted a structured gap analysis to identify methodological weaknesses, misalignments, and quality risks.

4. Development of Revised ORM & PRM Approaches

• Proposed coherent methodologies addressing:
• Probabilistic adequacy frameworks
• RES variability and ramping impacts
• Nuclear fleet contribution characteristics
• Role of interconnectors
• Synergies between reserve products
• Dynamic vs. static adequacy assessments
• Structured alignment between short-term operational reserves and long-term planning margins.

5. Implementation Outlook & Roadmap

• Defined testing and validation methodologies using market simulation tools (e.g., PLEXOS).
• Developed comparison criteria for alternative methodologies.
• Outlined regulatory and governance implications.
• Delivered a structured roadmap for Phase II (analytical validation) and Phase III (implementation).

Outcome

Delivered a harmonized conceptual framework for PRM and ORM methodologies, incorporating probabilistic adequacy principles and high-RES system characteristics. The project strengthened methodological consistency between planning and operations and established a structured pathway toward implementation and regulatory alignment.