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The increase in renewable power generation causes an overall decrease in conventional power generation from largescale and highly predictable fossil power plants. Aside from market-based provision of active power schedules, these power plants are crucial for the provision of short-term automatic ancillary services such as frequency and voltage control. Substituting these plants for renewable generation units requires the latter to be capable of providing these ancillary services in order to guarantee a reliable and stable power supply. In this paper we present an integrated approach for identifying distributed coalitions of agents representing units capable of providing frequency response reserve. We present a method for calculating the individual droop control parameters of each participating device taking into account opportunity costs, device specific reliabilities (e.g. for photovoltaic or wind installations) as well as the small-signal stability of such a coalition for frequency response reserve.

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