Flexibility in power systems: what’s there beyond the buzzword?

The increasing penetration of intermittent renewable energy sources, together with the electrification of end uses like heating and transport, is reshaping Europe’s electricity system. As these trends accelerate, flexibility is now widely recognised as a key enabler for integrating renewable energy, ensuring system reliability and managing grid congestion.

In this Topic of the Month, we explore the role of flexibility in Europe’s power system from several perspectives.

What do we mean by ‘flexibility’ in power systems?

Over the past few years, the term “flexibility” has entered multiple areas of European energy policy and regulation. It appears, for example, in Directive (EU) 2019/944, which promotes the use of flexibility in distribution networks. It was also the topic of the assessment undertaken by the European Environment Agency (EEA) and ACER, which aimed to quantify daily, weekly and monthly flexibility needs.

However, as the term became more common, its meaning also became increasingly ambiguous. An important contribution of the Electricity Market Design reform in this regard was the introduction of a definition for flexibility[1], which was then further refined by the flexibility needs assessment methodology. More specifically, the methodology distinguishes between two types of flexibility needs: network and system needs. Network flexibility needs are defined as the ability to adjust to grid availability, particularly to prevent or resolve congestion or voltage issues, across all applicable timeframes. System flexibility needs are defined as the ability of the electricity system to adjust to the variability of generation and consumption patterns across relevant market timeframes. Within system flexibility needs, three subcategories are outlined:[2]

• RES integration needs, or the amount of flexibility required for a Member State to meet its renewable energy integration target, which can be on a daily, monthly or annual basis.
• Ramping needs, associated with variations in residual load under perfect forecast conditions.
• Short‑term flexibility needs, linked to unexpected variations in residual load, such as forced outages during the intraday and balancing timeframe.

How much flexibility will be needed in the coming decades?

In Europe, a systematic assessment of flexibility needs represents a recent novelty. The national flexibility needs assessments due by July 2026, followed by the EU‑wide analysis performed by ACER due to July 2027, are expected to provide a clearer picture.

In the meantime, several studies offer preliminary insights.[3] While methodologies between these studies vary, a consistent conclusion emerges: system flexibility needs in Europe are expected to double by 2030 and increase six‑fold by 2050 compared to early‑2020s levels. The main driver of this rapid increase in 2030 is the changing generation mix, especially the massive deployment of solar PV and its distinct daily production profile. In the longer term, towards 2040 and 2050, growing electricity demand is expected to become the dominant driver. [4]

The increase in anticipated system flexibility needs might be amplified by the slow expansion of electricity grids. An analysis carried out by the Joint Research Centre (JRC) shows that if transmission infrastructure continues to expand at its current pace, congestion and redispatch needs will rise significantly. Even in a favourable scenario where transmission grids grow by roughly a third by the end of the current decade, redispatch costs are expected to rise from about 5 to 9 billion euros per year. Renewable generation curtailment is also expected to increase sharply, by 50 to 121 TWh in 2030, due to network bottlenecks.[5] These numbers highlight how grid development and flexibility provision are deeply interlinked. We will therefore discuss the role of grids in more detail in the second instalment of the Topic of the Month.

Where can this flexibility come from, and how can we mobilise it?

Flexibility can be delivered by a broad range of sources and is ideally non‑fossil, in line with the EU’s decarbonisation objectives. Key flexibility providers include dispatchable low‑carbon generation, which can adjust output quickly and has relatively low start‑up and shut‑down costs. Large‑scale storage technologies, such as pumped‑storage hydropower and utility‑scale batteries, are also expected to contribute significantly. Demand‑side response may represent another important source, drawing on the potential of residential, industrial, commercial and public service consumers, although further progress is still needed to unlock this potential in practice.[6] We will examine the importance of consumer protection when providing flexibility in more detail in the third instalment of this series.

In general, flexibility can be mobilised in two ways: implicitly, when final customers or assets respond to varying electricity prices or network charges that reflect the value of electricity or network conditions at different moments; or explicitly, when flexibility providers adjust their consumption or generation through participation in electricity markets or following activation by system operators. Explicit flexibility can be enabled either through short-term energy activations or through long-term availability payments. In the fourth instalment of this Topic of the Month, we will look in more detail at one of these long‑term availability payments, namely non‑fossil flexibility support schemes.

When talking about flexibility, lots of interesting discussions lie ahead, but first we wish you a lovely spring break!

[1] More specifically, Regulation (EU) 2024/1747 defines flexibility as “the ability of an electricity system to adjust to the variability of generation and consumption patterns and to grid availability, across relevant market timeframes”.

[2] These three subcategories will be part of the flexibility needs assessments introduced in the Electricity Market Design reform. In addition, adequacy needs (already covered in the European and National Resource Adequacy Assessments) and certain TSO-specific reliability needs (such as inertia or system restoration) can also be considered as system flexibility needs.

[3] Among the many relevant contributions, the reader can consider: JRC, ‘Flexibility requirements and the role of storage in future European power systems’ (Publications Office of the European Union, 2023); EEA and ACER, ‘Flexibility solutions to support a decarbonised and secure EU electricity system’ (Publications Office of the European Union, 2023); JRC, ‘Redispatch and congestion management, Future proofing the European power market’ (Publications Office of the European Union, 2024); and ENTO-E, ‘System flexibility needs for the energy transition’ (ENTSO-E, 2024).

[4] JRC, ‘Flexibility requirements and the role of storage in future European power systems’ (Publications Office of the European Union, 2023), p. 11-13.

[5] JRC, ‘Redispatch and congestion management, Future proofing the European power market’ (Publications Office of the European Union, 2024). It is to be noted that the study by the JRC only considers the transmission network and cannot fully capture congestion emerging at the distribution level.

[6] Finally, it must be noted that cross-border interconnectors will also play an important role in the provision of flexibility.