Balancing markets visibly opening up to decentralised solutions, but significant room for improvement remains

On November 26, 2018, smartEn released its new edition of The smartEn map: balancing markets edition. Opening up balancing markets to demand response and decentralised energy resources allows innovative energy business models to flourish and brings numerous benefits to society. By allowing all technologies and service providers to participate in balancing markets, Europe can avoid the construction of new backup generation capacity by optimally using our existing resources, thus bringing more stability to the grid at a lower price to society. 

“Comparing the situation to a few years ago, we see that almost all countries have improved, even if some only in small ways,” says Frauke Thies, smartEn Executive Director. “However, we also see that some countries that were doing well before are now starting to fall back in their efforts. This is a problem. The market-transition must not stop half-way and further steps are needed before all technologies and service providers can truly participate on an equal footing.”

Overall, the smartEn map shows that balancing markets are gradually opening up to demand response and decentralised energy resources everywhere. Where markets were previously closed, they are slowly starting to open, or are planning to open them in 2019-2020, the report shows. Italy, for example, has just opened up one of its balancing products to the market, and now allows demand response and decentralized resources to participate. Further products are planned to follow. Ireland will also now start procuring all its balancing services on the market.

The report also finds that where the markets had already been open, new technologies are now being incorporated and products are undergoing a process of standardisation. Germany for example, has reduced several barriers for the participation of demand response and decentralised resources, and so has Belgium, while the Netherlands is removing challenging communication requirements between the Balance Service Providers and the Transmission System Operator (TSO).

Finally, a big concern is still the lack of statistics. The report shows that there are hardly any markets where absolute numbers are available for how much demand response and decentralised resources are participating. According to Frauke Thies: “The real progress can be tested only if information is transparent and we can monitor the numbers for all markets.”

Download the report here


6th December 2018

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