Local Markets for Flexibility Trading: Key Stages and Enablers

Simone Minniti, Niyam Haque, Phuong Nguyen and Guus Pemen
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Simone Minniti: Electrical Energy Systems Group, Eindhoven University of Technology, 5600 MB Eindhoven, The Netherlands
Niyam Haque: Electrical Energy Systems Group, Eindhoven University of Technology, 5600 MB Eindhoven, The Netherlands
Phuong Nguyen: Electrical Energy Systems Group, Eindhoven University of Technology, 5600 MB Eindhoven, The Netherlands
Guus Pemen: Electrical Energy Systems Group, Eindhoven University of Technology, 5600 MB Eindhoven, The Netherlands

Energies, 2018, vol. 11, issue 11, 1-21

Abstract: The European energy transition is leading to a transformed electricity system, where Distributed Energy Resources (DERs) will play a substantial role. Renewable Energy Sources (RES) will challenge the key operational obligation of real-time balancing and the need for flexibility will consequently increase. The introduction of a local flexibility market (LFM) would allow the trading of flexibility supplied by both producing and consuming units at the distribution level, providing market access to DERs, a support tool for Distribution System Operators (DSOs) and a value stream for energy suppliers. Aggregators and DSOs for different reasons can enhance the valuation of flexible DERs. Several research papers have assumed aggregators fully interacting with the electricity markets and DSOs contracting services with power system actors. These interactions are still not allowed in many European countries. This article aims to analyze the European regulation to identify the most important enablers and pave the way towards the full exploitation of DER flexibility, culminating in the establishment of an LFM. Therefore, three main stages, emerging from the progressive withdrawal of the current regulatory and market barriers, are identified: (1) enabling the aggregator’s trading, (2) evolution of the DSO’s role, and (3) key-design challenges of an LFM.

Keywords: aggregator; distribution system operator; distributed energy resources; local flexibility market; flexibility service (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (27)

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