Decarbonising while meeting growing demand

Power systems around the world are undergoing significant change, driven particularly by the increasing availability of low-cost variable renewable energy (VRE), the deployment of distributed energy resources, advances in digitalisation and growing opportunities for electrification. These changes require a profound power system transformation.

The increasing prominence of VRE is among the most important drivers of power system transformation globally. The properties of VRE interact with the broader power system, giving rise to a number of relevant system integration challenges. These challenges do not appear abruptly, but rather increase over time along with the increase in VRE penetration.

The impact of, and issues associated with, VRE depend largely on its level of deployment and the context of the power system, such as the size of the system, operational and market design, regulation and fundamentals of supply and demand.

The integration of VRE can be categorised into a framework made of six different phases, which can be used to prioritise different measures to support system flexibility, identify relevant challenges and implement appropriate measures to support the system integration of VRE.

Power system flexibility refers to the capability of a power system to maintain continuous service in the face of rapid and large swings in supply or demand, whatever the cause. Flexibility has always been an important requirement for power systems due to the need to plan for unexpected contingencies such as plant and transmission outages. However system flexibility has become increasingly important for policy makers as the share of VRE generation increases and needs to be addressed in all time domains from real-time operations to long-term system planning.

Phase 1 captures very early stages where VRE deployment (often no more than a few percent of annual energy demand) has no immediate impact on power system operation. Phase 2 flexibility issues emerge but the system is able to cope with them through minor operational modifications. Phases 3 through 6 respectively indicate greater influence of VRE in determining system operations; starting from the need for additional investments in flexibility; structural surpluses of VRE generation leading to curtailment; and structural imbalances in energy supply at seasonal and inter-year periods requiring sector coupling.