How does a hydro plant's participation in AGC contribute to the overall economic dispatch of a power grid?

A hydro plant's participation in Automatic Generation Control (AGC) significantly contributes to the overall economic dispatch of a power grid by enabling the system operator to efficiently allocate generation resources to meet real-time demand while minimizing operating costs. Economic dispatch is the process of determining the optimal output level of each generator connected to the grid to satisfy the total load demand at the lowest possible cost, while respecting system constraints like transmission capacity and generator limits. AGC allows the system operator to automatically adjust the output of participating generators, including hydro plants, in response to changes in load or generation availability. Hydro plants, particularly those with large reservoirs, often have relatively low operating costs compared to thermal power plants (coal, gas). By participating in AGC, hydro plants can be dispatched to quickly respond to load changes or frequency deviations, displacing more expensive thermal generation and reducing the overall system operating cost. Furthermore, hydro plants can provide ancillary services like regulation and spinning reserve, which are essential for maintaining grid stability and reliability. These services are often compensated separately, further improving the economic value of hydro generation. The flexibility and responsiveness of hydro plants in AGC allows for a more efficient and cost-effective operation of the entire power grid.