With the transformation of the energy system towards climate neutrality, changes are emerging in the existing markets for network-related requirements, i.e., the systemic requirements for the safe and stable operation of electricity grids. Power plants with guaranteed capacity are being phased out. Renewable energy sources can provide regulation energy and system services. The expansion of renewable energy sources, delayed network expansion, and the introduction of new gas power plants are altering the redispatch requirements.
In the future, network and system services will offer opportunities to tap into additional revenue potentials. The potentials for providing (non-) frequency-based system services, congestion management, and network connection optimization are to be estimated for 2023 and 2030, and assessed differentially for various technologies. Revenue potentials largely depend on the regulatory framework, including the possibility of bundling products.
The project was divided into four parts:
- Pros and cons of a market-based procurement of system services (SDL).
- Analysis of the demand for SDL and revenue potential for flexibility in 2023 and 2030.
- Product design and bundling for revenue optimization.
- Action strategies and proposed changes to the regulatory framework.
Based on revenue potentials and a comparison with the United Kingdom (including regulatory framework and bundling possibilities), action strategies, differentiated by system services, were derived for RWE. Particularly highlighted was given to the non-frequency-related system services such as “Voltage Control Services” (reactive power) and Instantaneous Reserve, which are to be procured through market mechanisms in the future. Additionally, proposals for adapting the regulatory framework in Germany were developed.
The study answers the question “Which electricity grid requirements can market participants fulfil, what revenue potential are associated with this and what would the ideal product designs and bundling look like?
