Electricity flexibility key for transition to renewable power system, the platform for the consultancy sector, reports on our study on energy system flexibility. In the report, experts Ksenia Tolstrup and Donald Kreiken guide readers through the flexibility landscape and explain its key role in the energy transition.

Electricity flexibility key for transition to renewable power system

With time running out and no easy, single solution to climate change, a huge boost to electricity flexibility will be an essential part of the strategy for a successful energy transition in Europe. The integration of renewables however calls for diverse sources of energy in multiple timeframes. That is according to a report from Magnus Energy.

Flexibility in the electricity system is increasingly seen as essential for the energy transition. Though there is certainly no ‘silver bullet’ to achieving a successful energy transition, flexibility at both the generation and consumption sides is seen by many stakeholders as key.

“Fundamentally, flexibility is a service that consists in the ability of an asset (or a pool of assets) to increase, decrease, or shift in time, energy generation or consumption. Especially on the generation side, flexible asset operation is not new,” said Magnus Energy in its report.

Electricity flexibility key for transition to renewable power system

In order for the world to achieve net-zero emission goals by the year 2050, there will need to be a fourfold increase in flexibility in the electricity sector alone. In both advanced and developing economies, that will imply a major increase in the use of energy derived from sector coupling, hydro generation, and battery storage.

Pointing at the example of Germany’s power system, the largest in Europe, the report projects that a significant amount of investment will be required to close the country’s flexibility gap by 2030. In terms of electricity demand, that would entail over 16GW of extra flexibility, according to several studies.

Electricity flexibility key for transition to renewable power system

Bridging the flexibility gap
The flexibility gap between what is needed and what is out there is made more acute by the ambitious national and EU-level decarbonization targets and the phaseout of conventional fossil-fuel based electricity generation. Germany, for example, has pledged to cut back on energy generated by coal and gas after having already shut down nuclear power plants.

The report emphasizes that with the availability of new flexibility options (such a storage, flexible demand or hydrogen generation) still low across Europe, grid flexibility becomes a heightened alternative. “In the current up to medium term conditions, European electricity grid and market integration are pivotal not just to exchange electricity but also to secure flexibility where it is needed the most in a given moment.”

The flexibility ecosystem is however highly complex, with numerous market and regulated actors competing for the scarce resource. “Ultimately, flexibility is a service regardless of its origin, technology, or network level. And thus, incentives to provide it and to use it are crucial,” according to the authors.

Electricity flexibility key for transition to renewable power system

The most attractive technology for increasing flexibility has been batteries, which has been an area of significant investment and growing maturity. According to the European Market Monitor on Energy Storage (EMMES), annual installed battery storage capacity in the EU and Great Britain is expected to grow almost 12-fold from 2018 to 2030.

The road ahead
The potential for more energy flexibility in Europe is high, but there is still a long way to go. Much of the attractiveness for investment into flexibility options is going to hinge on prices in the relevant markets, regulatory facilitation, and ease of entry, among other factors.

“For this to fly, new products and services must be developed, requiring collaboration with grid operators, market parties, and policy makers. Often a long and complex road,” warned the authors.

Magnus Energy also highlighted that as Europe faces its flexibility gap, with investment-led capacity to trail demand, it will be important to make the most of the existing options, including price-responsive consumption and interconnectors, in order to achieve a successful transition.

More about this topic? You can download the full report here.


Ksenia Tolstrup

Principal +31 85 7430519