Position paper on flexibility markets

The current congestion management process in Germany is based on cost-based redispatch and the restriction of renewable energies. The costs currently amount to around 1.5 billion euros in Germany. In parallel, an EU regulation promotes the adoption of market-based Redispatch concepts.

Several pilot projects have been launched in Germany to facilitate the introduction of market-based approaches that enable decentralised provision of flexibility – not only of generators, but also of loads and storage systems. However, the German government is currently of the opinion that such market-based concepts will lead to an increase in undesirable strategic offers and a decrease in general social welfare for consumers.

On behalf of NODES, an independent market operator for flexibility markets, E-Bridge evaluated the advantages of flexibility markets, compared them with a cost-based redispatch approach and discussed risk reduction strategies on the basis of practical examples taking into account strategic bidder risks. E-Bridge concluded that a market-oriented redispatch is a necessary complement to the current German redispatch regime.

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Dr. Henning Schuster »
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+49 228 909065-0

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Matthias Wessels »
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+49 228 909065-0

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