Leonardo ENERGY and Ecofys identify flexibility gap in power systems with higher shares of variable renewable energy sources
A recent overview clarifies the flexibility needs for the transition to power systems with high penetration levels of variable renewable energy sources (VRES). The report provides a comprehensive assessment of the complete spectrum of flexibility options and identifies key barriers for their deployment. The report “Flexibility Options in Electricity Systems” has been launched by Leonardo ENERGY, the Global Community for Sustainable Energy Professionals, and energy consultancy Ecofys. It shows that increasing flexibility is key for the reliable operation of future power systems. According to the report, a “flexible” power system is able to maintain continuous service especially in the face of rapid and large swings in supply or demand. The introduction of VRES such as wind and solar energy increases the requirements for power system flexibility for two reasons: VRES increase the variability in energy supply, increasing the need for flexibility; and VRES displace part of the conventional generation capacity, tending to reduce flexible resources in the system.
The “flexibility gap” unveiled in the report will need to be covered by new flexibility options. Sixteen fact sheets describe the characteristics of the key flexibility options, based on five basic flexibility categories: supply, demand, energy storage, network, and system. The options covered include flexibility in fossil fuels, nuclear, biogas, CHP, demand management, electric vehicles, power to heat, hydro, flywheels, batteries, power to gas and others. The authors also consider market options to uncap flexibility, and network options to increase flexibility. “With increasing levels of VRES penetration, the electricity systems will need more flexibility options,” says Hans De Keulenaer, Leonardo ENERGY Programme Manager – Electricity & Energy.
“As expected, the main mature options are currently on the supply side, but increasingly, the demand side will need to play a bigger role. Currently, demand side management is limited to large-scale industrial installations. It needs to be extended to buildings and eventually households.” “New flexibility options in demand and storage require control and communication infrastructure”, says Dr. Georgios Papaefthymiou, main author of the report at Ecofys. “A more sophisticated control of the variable renewable energy sources can also be a cost-effective opportunity for providing system flexibility.” The authors also recognizee that active power control of VRES needs to take technical, institutional, perceptual, and potentially political challenges into account.
The report is available for download online at:
From the summary
It is widely recognized that increasing flexibility is key for the reliable operation of future power systems with very high penetration levels of variable renewable energy sources (VRES). The starting point of this report is the understanding of the flexibility requirements for enabling the transition to such power systems. Furthermore, this report aims in providing a comprehensive assessment of the complete spectrum of flexibility options (instead of focusing on specific ones) and to identify key barriers for their deployment.
Flexibility is the ability of a power system to maintain continuous service in the face of rapid and large swings in supply or demand. Traditionally, flexibility was provided in power systems almost entirely by controlling the supply side. In systems with increasing shares of VRES, additional flexibility is needed to maintain system reliability as the variations in supply and demand grow to levels far beyond what is seen today. VRES reduce the flexibility resources in the system by displacing traditional supply side flexibility providers while simultaneously increasing the need for flexibility due to their inherent stochastic nature. This creates a “flexibility gap” that will need to be covered by new flexibility options.
Variability impacts all different power system operational timeframes. A transformation of power system operational planning is expected. The question of having sufficient resources to meet demand is changed to having sufficient flexibility resources to balance net demand forecast errors and fluctuations. By increasing VRES penetration levels, the impacts to more long-term timeframes become more visible. This affects the choice of suitable flexibility options: in shorter timeframes, response times are of more importance; in longer timeframes, the ability to offer large storage content and long shifting periods would be of more importance. Power systems should deploy the most economic resources for provision of energy and operational flexibility. New flexibility resources will compete with flexibility capabilities of the existing system, such as network expansion, existing supply flexibility. In this report, a detailed analysis of the characteristics of the key flexibility options is presented. We analyze 16 options covering five key categories of flexibility provision, i.e. supply, demand, energy storage, network and system.
The results show that different flexibility options are best suited to different operational timeframes. The variety of options show that there are several options to consider in each timeframe. As expected, the main mature options are on the supply side; on the demand side, a key mature option is the large-scale industrial demand response, while pumped hydro is the main mature storage technology. Most of the new demand and storage options are small scale technologies. The development of these options depends on the enabling communication and control infrastructure, which for such small scale units will represent a relatively higher share of costs. In the long run, only one storage technology competes with thermal power plants (however in the expense of high losses): Power to gas. For systems with higher VRES shares, more sophisticated control of VRES can be a more cost effective opportunity for providing system flexibility (or alternatively, reducing the needed flexibility). This option however faces institutional, perceptual, and potentially political challenges due to the perception that renewable energy is being wasted.
Specific market barriers are identified, which may hinder the development of flexibility options. A key difference is that investments in supply options are driven by high market prices, while market price variability (spreads) is an indicator for investments in flexibility. However, market prices and spreads are related to each other, making any intervention on the supply side having impact to the other options. In markets with overcapacities, market price variability is reduced. Therefore, the incentives for flexibility are removed. Making future markets provide sufficient incentives for peaking capacity and flexibility is a key challenge towards systems with higher VRES shares. Furthermore, one main barrier to demand management is a lack of systems and incentives for loads to participate in power system operations. Smart metering infrastructure could boost the prospects for residential and commercial demand management. Finally, reviewing the prequalification standards in markets could open additional markets to new flexibility options and to VRES (e.g. reduction of minimum bid sizes, shorter scheduling periods and reduction of gate closure times).
Leonardo Energy www.leonardo-energy.org
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