NEWS

Position Paper: Asset class vs. Service based approach for system services

Jul 14, 2021

Across Europe, participants in the electricity system have been changing rapidly. From a one-directional energy flow that went from traditional generation to consumers, to a circular electricity system, where renewable energies, storage, electric vehicles and prosumers now play an active role in both withdrawing and injecting electricity.
While suitable for most current and traditional technologies, the network code design is not designed to take full advantage of innovative technologies in the new decentralised energy landscape. The network codes depend on the definition of asset classes that are not suited for new technologies. For example, storage does not fit in the traditional definition of asset classes, which are either generation or demand. Storage can be a generation or consumption asset or both at the same time. Classifying resources incorrectly in one asset class limits the services it can provide, hindering its development, business case and the possibility for the system operator to use lower cost resources for balancing the grid.The alternative to asset classes is to define the services required by the grid in a technology-agnostic way and allow different technologies to provide them. For this approach to work, smartEn calls ENTSO-E, ACER and the European Commission to shape a strategy to adapt those network codes, that are still built upon the concept of asset classes.

Download the position paper to read more.

More NEWS

  • smartEn together with 6 stakeholder organizations and drafting committee members, welcome the new network code proposed by ENTSO-E and the EU DSO Entity. This code is essential for supporting decarbonization and enhancing Europe’s energy security by enabling distributed energy resources (DERs) and demand response. The new code aims to remove the market access barriers, ensuring broad market participation and facilitating market-based procurement of flexibility services. We thank all involved in drafting this proposal and emphasize the need for effective, harmonized, and forward-looking regulations to promote a secure, efficient, and decentralized energy system.

  • Making better use of the grids thanks to the contribution of existing and future connected flexible consumers is an efficient approach to tackle urgently the congestion challenge. The Flexible Demand Management Industry that smartEn represents can empower grid users, i.e. grid connected buildings, industries and electric vehicles, to play an active role in supporting an efficient and smart operation of grids. However, grids must be incentivised to use the flexibility of connected consumers, as already prescribed by EU laws. To support this effort, this paper: Sets out six strategic recommendations for the smart operation of grids which should guide the efficient delivery of the EU Grids Action Plan. Lays the groundwork for a dedicated EU Strategy on Grid Congestion which the new Commission should develop to deliver the European Green Deal by 2030. Such a strategy should foster harmonised approaches to tackle grid congestion issues across the EU, without waiting for lengthy network reinforcement, by harnessing the potential of connected, flexible consumers.

  • The Flexible Demand Management Industry provides solutions to all consumers – citizens, businesses, buildings, electric vehicles (EVs) and industries – to become flexible and be rewarded for playing an active role in the clean energy transition. As such, it needs to be fully recognised as a crucial clean-tech industry in Europe. But as the Flexible Demand Management Industry is very heterogeneous, it is often not easy for it to be identified as a specific industrial base and its significant contribution tends to be overlooked. This is a major gap to fill. This paper intends to inform this effort by answering these 3 questions:  What is the Flexible Demand Management Industry and what are the solutions offered?  Why the Flexible Demand Management Industry matters ?  What is needed in the next EU legislature for the Flexible Demand Management Industry to rightfully become a solid pillar of Europe’s decarbonised economy?

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