The system frequency of a power systems is a good indicator of the networks resilience to major disturbances. In a completely deregulated setting, for example in the Nordic power system, the system operator controls the system frequency manually by calling-off bids handed in to a market, called the regulating market.

In this paper we formulate the problem of optimal bid call-off on the regulating market, that the system operator is faced with each operating period, as an optimal switching problem with execution delays.

As general optimal switching problems with execution delays are computationally cumbersome we resort to a recently developed suboptimal solution scheme, based on limiting the feedback information in the control loop.