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The high proliferation of converter-dominated Distributed Renewable Energy Sources (DRESs) at the distribution grid level has gradually replaced the conventional synchronous generators (SGs) of the transmission system, resulting in emerging stability and security challenges. The inherent characteristics of the SGs are currently used for providing ancillary services (ASs), following the instructions of the Transmission System Operator, while the DRESs are obliged to offer specific system support functions, without being remunerated for these functions, but only for the energy they inject. This changing environment has prompted the integration of energy storage systems as a solution for transfusing new characteristics and elaborating their business in the electricity markets, while the smart grid infrastructure and the upcoming microgrid architectures contribute to the transformation of the distribution grid. This review investigates the existing ASs in transmission system with the respective markets (emphasizing the DRESs’ participation in these markets) and proposes new ASs at distribution grid level, with emphasis to inertial response, active power ramp rate control, frequency response, voltage regulation, fault contribution and harmonic mitigation. The market tools and mechanisms for the procurement of these ASs are presented evolving the existing role of the Operators. Finally, potential barriers in the technical, regulatory, and financial framework have been identified and analyzed.

The main objective of this paper is three-fold. First, to provide an overview of the current status of the power electronics technology, one of the key actors in the upcoming smart grid paradigm enabling maximum power throughputs and near-instantaneous control of voltages and currents in all links of the power system chain. Second, to provide a bridge between the power systems and the power electronic communities, in terms of their differing appreciation of how these devices perform when connected to the power grid. Third, to discuss on the role that the power electronics technology will play in supporting the aims and objectives of future decarbonized power systems. This paper merges the equipment, control techniques and methods used in flexible alternating current transmission systems (FACTS) and high voltage direct transmission (HVDC) equipment to enable a single, coherent approach to address a specific power system problem, using 'best of breed' solutions bearing in mind technical, economic and environmental issues.

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