March 16, 2023: Increased use of small-scale renewables and energy storage systems to help stabilize the European electricity market and ease the energy crisis are included in European Commission proposals published today.
Electricity market reform is needed because the energy crisis has shown “how exposed consumers and industries are and our lack of resilience to energy price spikes”, according to the proposed amended regulations.
In a boost for deployment of ESS and small-scale renewables, national market operators will be expected to support trading in day-ahead and intraday markets that are “sufficiently small in size, with minimum bid sizes of 100kW or less” — instead of the existing 500kW or less requirement.
This will allow for the effective participation of demand-side response, energy storage and small-scale renewables including direct participation by customers, the draft says, in a move that could also include vehicle-to-grid technologies.
The proposals say consumers should also be able to choose a separate supplier for electricity to power appliances such as heat pumps or electric vehicles that have a particularly high consumption, or which also have the capability to shift their electricity consumption automatically in response to price signals.
And EU member states will be required to do more to encourage investment in promoting the participation of demand side response and energy storage.
“As more wind and solar power enter the system, storage in particular will be needed to balance the variable supply with variable demand,” the proposals say.
Transmission system operators will be required to publish “in a clear and transparent manner” information on the capacity available for new connections in their respective areas of operation, including in congested areas if flexible energy storage connections can be accommodated, and update that information at least quarterly.
The assessment of the flexibility needs of the electricity system should take into account all existing and planned investments on sources of flexibility, including ESS systems, according to the proposals, which must be discussed and agreed by the European Parliament and European Council before entering into force.