Provision of ancillary services in the electric power system by aggregatorsTASEVSKA, NATALIJA (Avtor) Pantoš, Miloš (Mentor) aggregationflexibilitydemand responseelectricity marketsdistributed generation/consumptionIn the last couple of years electricity market landscape has significantly changed. The rising share of distributed generation and consumption increases price volatility and causes additional intermittencies to the grid. Thus, the grid must become more flexible. This paper refers to the role of aggregators as flexibility providers in the new smart grids. Its main objective was to develop an actual aggregator model which aggregates commercial and industrial consumers for providing active demand response. The idea behind it was to identify possibilities and potential challenges for aggregators on partially closed electricity markets. For this purpose, an implementation of an aggregator business model on the market in Croatia was analyzed. The paper consists of several parts. In the first part the principle of operation and value proposition of an aggregator business model are defined. The second part refers to regulatory framework and current market design. In the third part the necessary hardware and software solutions for developing the aggregator model are determined and total investment costs are calculated. The last part specifies the properties of the implemented model and analyses its cost-effectiveness. From the analysis, it can be concluded that, when implementing an aggregator on an electricity market which is not completely open, several aspects should be discussed. The main issue emerges from the current market design and the lack of incentives for prosumers to join the aggregator. A new aggregator business model requires separating the balancing responsibility, setting up a compensating financial transfer mechanism and slightly changing the regulatory framework. However, the aggregator has a positive impact on the market and its implementation is cost effective for the prosumers and for the investors.20222022-07-01 13:15:00Magistrsko delo/naloga137822VisID: 60978COBISS_ID: 113639171sl