EPICO published a new paper highlighting the need for an integrated approach to increasing flexibility in Germany's electricity market. The analysis, carried out by EPICO and Aurora, shows how various instruments can be combined into a coherent strategy, suggesting quick actions on no-regret measures, such as lowering regulatory hurdles for battery expansion and adapting the legal framework for aggregators. This integrated approach should be open to all technologies.
The study presents technologies and approaches for power market flexibility, including:
- Demand-side flexibility in households (e.g. shifting EV charging times);
- Accelerating a technology-neutral flexibility strategy;
- Flexibility in the industrial sector;
- Storage solutions;
- Adding new power plants with various energy sources (e.g. gas, hydrogen, biomass).
The study also analyses policy instruments to strengthen flexibility in the German electricity market, including:
- Power plant and electricity storage strategies;
- Introduction of “dynamic” tariffs with smart meter rollout;
- Revising grid fee structures to incentivise grid-friendly industry behaviour;
- Establishing a capacity market open to all technologies.
The study emphasises the added value of a flexible electricity system: leveraging flexibility potential in Germany can make the energy transition more effective for overall system costs, households and industry. More flexibility, such as demand-side flexibility, means less need for fossil-fuel back-up power plants, helping achieve climate targets more efficiently.