Flexibility in the power system: Challenges and strategies

Germany already generates more than a third of its electricity from renewable sources, and plans to continue the expansion of renewable energy source (RES) production so that it replaces fossil fuels by 2050. This target has implications for the power system as a whole. Solar, wind and hydro generation output varies – in other words, the structure of power generation fluctuates – depending on weather conditions and time of day. In order to ensure that all consumers’ electricity needs can be met at all times, other power system components must respond in order to balance these fluctuations. This requires flexibility of operation: it must be possible to bring other low-emission – e.g. gas-fired – power plants online in a flexible manner; there must be scope for variable charging and discharging of storage systems; and the fulfilment of certain types of electricity needs must, if necessary, be postponed (load management).

From the Oeko-Institut’s perspective, however, power system flexibility is not only about storage management. Expanding storage capacities is not the only option for bridging the gaps left by renewables. Scientists at the Oeko-Institut are engaged in detailed research to determine to what extent flexibility is required in a range of scenarios and which specific technologies are currently available – or will be in future – to support flexible use of the generation mix. They are also exploring the potential offered by demand side management, calculating the costs of these flexibility options and assessing the various technologies’ environmental impacts.

A comprehensive comparison of flexibility and storage options

With their study, entitled “Systematic comparison of flexibility and storage options”, published at the end of 2016, the researchers presented a comprehensive assessment which showed when additional flexibility options will be needed to support renewables expansion. Their analysis, funded by the German Federal Ministry for Economic Affairs and Energy (BMWi), shows that the existing pumped storage systems and power plant fleet offer sufficient flexibility to balance out fluctuations associated with renewables use. Yes, other options should be developed, starting today, but there is no need to postpone the further expansion of renewables pending additional measures to boost flexibility. In fact, additional flexibility is required only in scenarios based on a 60 per cent renewables share in the energy mix – and even here, the potential of existing technical options are quite sufficient.

The research team concludes that more reliance on demand side management, especially in business and industry, is an attractive option for smoothing out fluctuations in feed-in over the course of the day. For example, the operation of cold storage facilities, sewage treatment plants and waterworks and the production of energy-intensive goods such as aluminium and paper should be ramped down whenever few RES electricity is available and vice versa.

The scientists also analysed the potential for expanding flexibility options beyond 2030. They conclude that at some point in the future (probably once an 80 per cent renewables share has been reached), long-term storage installations with sufficient capacity to bridge extended windless periods will be required. The researchers suggest that new power plants fuelled by renewable power-to-gas systems may have a role to play here.

Study by the Oeko-Insitut in German: "Systematischer Vergleich von Flexibilitäts- und Speicheroptionen im deutschen Stromsystem"

Ecological power generation?

In another recent study, this time for Greenpeace Energy, the Oeko-Institut shows that realigning the power system with environmental criteria can cut greenhouse gas emissions and create incentives for low-carbon electricity production and storage. In today’s market system, fuel costs are the key determinant of which generation plants produce power and sell it on the electricity exchanges. In line with the merit order principle, most electricity is produced by coal- and lignite-fired power plants, which operate in parallel to the renewable energy systems. But if the existing power plant fleet were deployed in accordance with ecological criteria, Germany would be able to reduce its CO₂ emissions from the electricity sector by as much as 25 per cent.

Based on their scenarios, the Oeko-Institut researchers conclude that power plants which produce low CO₂ emissions, such as gas-fired systems, should take precedence over high-emission plants. If the power plants were thus permitted to generate electricity according to their climate impact, Germany’s annual CO₂ emissions could immediately be reduced by around 79 million tonnes. While such an approach would involve a moderate increase in fuel prices, this would be considerably lower than the average costs of mitigating CO₂-related climate change. The study also analyses and assesses the mitigation contributions which could potentially be made by other flexibility options and considers additional environmental impacts resulting from these options.

Study by the Oeko-Insitut in German: "Ökologische Bereitstellung von Flexibilität im Stromsystem"

Infographics and explanations (in German) of the merit order principle by the Oeko-Institut (freely utilizable, CC licence)

Open questions: European electricity market, resources, new consumers

There is scope to achieve more flexibility in future by means of cross-border electricity exchanges within the European grid. This would make it easier for surplus RES electricity produced in one country to be shared with others. This will require more intensive efforts to expand the European grid. The link between the German power system and potential developments in neighbouring European countries is the subject of study in a current project, entitled “Energy transition in the German power system in the context of future development options in Europe to 2050” funded by the German Federal Ministry for Economic Affairs and Energy (BMWi).

The Oeko-Institut’s experts also explore the regulatory frameworks applicable to the further development of flexibility options. In the Oeko-Institut’s view, the initial priority is to remove the diverse barriers obstructing the development or expansion of the various technologies. This is essential if the flexibility options are to respond to price signals in the electricity market in line with their potential. It may mean storing electricity when there is surplus supply or feeding stored power into the market at times of rising demand.

The researchers draw attention to the potential conflicts of interest with other aspects of sustainability: one example is the demand for resources to manufacture powerful batteries to store RES electricity. And finally, they point out that over the coming years, the growth in the use of electric vehicles will result in many new small-scale electricity consumers – who may potentially provide storage capacities – entering the system. Further research is needed over the coming years to identify ways of optimising their integration so that the benefits they offer for flexible electricity storage can be utilised to the full.