Summary
The contribution of hybrid controller of large‐scale wind power generation system (LWPGS) in system stability and profit is discussed throughout the paper. To this purpose, it is necessary to formulate the impact of high infiltration of wind turbines on the dynamic stability of power networks. A mathematical model of a multi‐machine power network is developed first, based on which an extended small‐signal stability analysis procedure is projected and discussed to handle the influence of LWPGS on oscillatory modes. This model is then applied for analyzing the damping impact of the LWPGS and ancillary service (AS) associated with its controller. After the model creation, the profit created by LWPGS hybrid controller as AS is analyzed by multi‐objective optimization based on low‐frequency oscillation stability criterion and generation cost. Two scenarios for the valuation of small‐signal stability as an AS provided by LWPGS controller are considered. The study is based on a changed 16‐machine 5‐area network. The comparative analysis of the results is also presented to elucidate the suggested approach. Copyright © 2015 John Wiley & Sons, Ltd.