IDEAS home Printed from https://ideas.repec.org/a/gam/jeners/v17y2024i12p2876-d1413189.html
   My bibliography  Save this article

Efficient Operationalization of Flexibility Procurement: Market Design Analysis and Process Definition

Author

Listed:
  • Sarah Fanta

    (AIT Austrian Institute of Technology GmbH, Giefinggasse 4, 1210 Vienna, Austria)

  • Ksenia Tolstrup

    (Magnus Energy, Gooimer 5-39, 1411 DD Naarden, The Netherlands)

  • Markus Riegler

    (APG Austrian Power Grid, IZD-Tower, Wagramer Str. 19, 1220 Vienna, Austria)

  • Lukas Obernosterer

    (APG Austrian Power Grid, IZD-Tower, Wagramer Str. 19, 1220 Vienna, Austria)

  • Christina Wirrer

    (APG Austrian Power Grid, IZD-Tower, Wagramer Str. 19, 1220 Vienna, Austria)

Abstract

Flexibility provision for ancillary services and electricity markets has been widely seen as crucial for the future of highly interconnected energy systems with high shares of renewables. Yet, little research has so far addressed (1) how its procurement could be best operationalized and (2) how limited flexible resources can be used more efficiently given the growing system needs. This paper focuses on flexibility services for transmission operators, specifically balancing and redispatch, as well as the intraday market within the context of the European electricity market. To analyze possible services and/or market combinations, we compare three modes of flexibility procurement: (a) sequential, (b) parallel and (c) combined. We evaluate the different modes of procurement options based on eight criteria. We further investigate how the procurement of flexibility, including small-scale technical units, could be organized via a flexibility platform given the most promising implementation setup, and detail the process for “flexibility service provider <> flexibility platform <> market interaction”, taking the multi-use-case logic into account.

Suggested Citation

  • Sarah Fanta & Ksenia Tolstrup & Markus Riegler & Lukas Obernosterer & Christina Wirrer, 2024. "Efficient Operationalization of Flexibility Procurement: Market Design Analysis and Process Definition," Energies, MDPI, vol. 17(12), pages 1-19, June.
    • Handle: RePEc:gam:jeners:v:17:y:2024:i:12:p:2876-:d:1413189
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/1996-1073/17/12/2876/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/1996-1073/17/12/2876/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Karim L. Anaya & Michael G. Pollitt, 2021. "How to Procure Flexibility Services within the Electricity Distribution System: Lessons from an International Review of Innovation Projects," Energies, MDPI, vol. 14(15), pages 1-26, July.
    2. Attar, Mehdi & Repo, Sami & Mann, Pierre, 2022. "Congestion management market design- Approach for the Nordics and Central Europe," Applied Energy, Elsevier, vol. 313(C).
    3. Heilmann, Erik & Klempp, Nikolai & Wetzel, Heike, 2020. "Design of regional flexibility markets for electricity: A product classification framework for and application to German pilot projects," Utilities Policy, Elsevier, vol. 67(C).
    4. Rebenaque, Olivier & Schmitt, Carlo & Schumann, Klemens & Dronne, Théo & Roques, Fabien, 2023. "Success of local flexibility market implementation: A review of current projects," Utilities Policy, Elsevier, vol. 80(C).
    5. Schittekatte, Tim & Meeus, Leonardo, 2020. "Flexibility markets: Q&A with project pioneers," Utilities Policy, Elsevier, vol. 63(C).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Potenciano Menci, Sergio & Valarezo, Orlando, 2024. "Decoding design characteristics of local flexibility markets for congestion management with a multi-layered taxonomy," Applied Energy, Elsevier, vol. 357(C).
    2. Rebenaque, Olivier & Schmitt, Carlo & Schumann, Klemens & Dronne, Théo & Roques, Fabien, 2023. "Success of local flexibility market implementation: A review of current projects," Utilities Policy, Elsevier, vol. 80(C).
    3. Bellenbaum, Julia & Höckner, Jonas & Weber, Christoph, 2022. "Designing flexibility procurement markets for congestion management – investigating two-stage procurement auctions," Energy Economics, Elsevier, vol. 106(C).
    4. Heilmann, Erik, 2023. "The impact of transparency policies on local flexibility markets in electric distribution networks," Utilities Policy, Elsevier, vol. 83(C).
    5. Erik Heilmann, 2021. "The impact of transparency policies on local flexibility markets in electrical distribution networks: A case study with artificial neural network forecasts," MAGKS Papers on Economics 202141, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    6. Carlo Schmitt & Felix Gaumnitz & Andreas Blank & Olivier Rebenaque & Théo Dronne & Arnault Martin & Philippe Vassilopoulos & Albert Moser & Fabien Roques, 2021. "Framework for Deterministic Assessment of Risk-Averse Participation in Local Flexibility Markets †," Energies, MDPI, vol. 14(11), pages 1-34, May.
    7. Chen, Ting & Vandendriessche, Frederik, 2023. "Evolution of the EU legal framework for promoting RES-E: A market compatible paradigm shift?," Utilities Policy, Elsevier, vol. 83(C).
    8. Hennig, Roman J. & de Vries, Laurens J. & Tindemans, Simon H., 2023. "Congestion management in electricity distribution networks: Smart tariffs, local markets and direct control," Utilities Policy, Elsevier, vol. 85(C).
    9. Erik Heilmann & Nikolai Klempp & Kai Hufendiek & Heike Wetzel, 2022. "Long-term Contracts for Network-supportive Flexibility in Local Flexibility Markets," MAGKS Papers on Economics 202224, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    10. Kara, Güray & Tomasgard, Asgeir & Farahmand, Hossein, 2022. "Characterizing flexibility in power markets and systems," Utilities Policy, Elsevier, vol. 75(C).
    11. Karim L. Anaya & Michael G. Pollitt, 2021. "How to Procure Flexibility Services within the Electricity Distribution System: Lessons from an International Review of Innovation Projects," Energies, MDPI, vol. 14(15), pages 1-26, July.
    12. Palovic, Martin, 2022. "Administrative congestion management meets electricity network regulation: Aligning incentives between the renewable generators and network operator," Utilities Policy, Elsevier, vol. 79(C).
    13. Anna Pechan & Marius Buchmann, 2023. "Market design for the procurement of reactive power: the current state in Germany," Bremen Energy Working Papers 0046, Bremen Energy Research.
    14. Covatariu, A. & Duma, D. & Giulietti, M. & Pollitt M., 2023. "Toward an operational definition and a. methodology for measurement of the active DSO (distribution system operator) for electricity and gas," Cambridge Working Papers in Economics 2348, Faculty of Economics, University of Cambridge.
    15. Davi-Arderius, Daniel & Schittekatte, Tim, 2023. "Carbon emissions impacts of operational network constraints: The case of Spain during the Covid-19 crisis," Energy Economics, Elsevier, vol. 128(C).
    16. Theo Dronne & Fabien Roques & Marcelo Saguan, 2021. "Local Flexibility Markets for Distribution Network Congestion-Management in Center-Western Europe: Which Design for Which Needs?," Energies, MDPI, vol. 14(14), pages 1-18, July.
    17. Chun Xia-Bauer & Florin Vondung & Stefan Thomas & Raphael Moser, 2022. "Business Model Innovations for Renewable Energy Prosumer Development in Germany," Sustainability, MDPI, vol. 14(13), pages 1-17, June.
    18. Liao, Qi & Tu, Renfu & Zhang, Wan & Wang, Bohong & Liang, Yongtu & Zhang, Haoran, 2023. "Auction design for capacity allocation in the petroleum pipeline under fair opening," Energy, Elsevier, vol. 264(C).
    19. Luyao Zhang & Fan Zhang, 2023. "Understand Waiting Time in Transaction Fee Mechanism: An Interdisciplinary Perspective," Papers 2305.02552, arXiv.org.
    20. Ajla Mehinovic & Matej Zajc & Nermin Suljanovic, 2023. "Interpretation and Quantification of the Flexibility Sources Location on the Flexibility Service in the Distribution Grid," Energies, MDPI, vol. 16(2), pages 1-18, January.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jeners:v:17:y:2024:i:12:p:2876-:d:1413189. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.