Flexibility Characterization, Aggregation, and Market Design Trends with a High Share of Renewables: a Review

Abstract

Abstract Purpose of Review Balancing a large share of solar and wind power generation in the power system will require a well synchronized coordination of all possible flexibility sources. This entails developing market designs that incentivize flexibility providers, and define new flexibility products. To this end, the paper reviews latest trends in the characterization of flexibility by understanding its dimensions in terms of time, spatiality, resource type, and associated risks. Also, as aggregators have emerged as important actors to deliver, and to reward end-user flexibility, the paper reviews latest trends in the topic. Recent Findings The review reports latest trends and discussions on power system flexibility and their relations to market design. The current academic literature indicates that there are open question and limited research on how to reward short-term flexibility while considering its long-term economic viability. Demand-side flexibility through aggregation holds great potential to integrate renewables. Summary Research in power system flexibility has to put effort on analysing new time-structures of electricity markets and define new marketplaces that consider the integration of new flexibility products, actors (e.g. aggregators, end-users), and mechanisms (e.g. TSO-DSO coordination).