Working Paper

Disentangling flexibility and its needs assessment methodology

as mandated by the updated Electricity Regulation

The newly updated European Electricity Regulation puts flexibility at centre stage. What does flexibility mean, and how is it different from adequacy? How can we assess flexibility potential and needs? And what are the implications for the different energy system stakeholders? Magnus Energy’s experts take you on board in a new working paper on flexibility needs assessment.

Key takeaways of the working paper

The EU’s electricity markets have historically had a strong energy-only premise. The latest update of the Electricity Regulation is a shift towards a more holistic view of flexibility where both its activation (MWh) as well as its reservation (MW) are crucial for the energy transition.
Compared to adequacy¹, flexibility is multi-dimensional in terms of its goals, timeframes, and use cases. This also means that additional indicators will be required to account for this complexity.
Flexibility needs assessment methodology can be “consistent” with the ERAA methodology only to an extent, while a more granular resolution – time and location-wise – will likely be required for the former.
Flexibility needs are the sum of their multiple use cases considering technical requirements, possible overlaps and competition between them or with potential support schemes, whereas the ERAA methodology focuses rather on general availability of supply to satisfy demand at all times.
Given a limited design and implementation timeframe, a balance between simplicity and significance of results will need to be struck.