Abstract
The integration of large amounts of variable renewable energy poses fundamental challenges to the operation and governance of the energy system. In this article we address the main institutional challenges that are caused by the integration of variable renewable energy sources like solar and wind energy in the European power system. We first address how the variable and unpredictable nature of wind and solar energy increases the demand for flexible resources and we discuss potential sources of flexibility. Next, we elaborate on how the need for more flexibility challenges the prevailing market design of todays liberalized power systems. Furthermore, we discuss the key areas where there is a need for a more integrated approach to research and policy making. The need for a more integrated approach is motivated by exposing a number of critical interdependencies between technical and institutional sub-systems.
Highlights
The transition to an energy system that is largely based on renewable energy sources (RES) is one of the greatest challenges of our time
We have discussed the major changes and challenges that the European power sector faces in the light of the transition to a system largely based on renewable energy sources
We showed how variability and uncertainty of RES output is requiring a higher degree of power system flexibility and we discussed various flexibility options
Summary
The transition to an energy system that is largely based on renewable energy sources (RES) is one of the greatest challenges of our time. The main RES integration challenges relate to the fundamental characteristics that the most widespread RES technologies – wind and solar – posses: variability and uncertainty These RES characteristics, often summarized in the notion of intermittency, cause friction – technical, operational, financial - when integrating them in the energy system. The second goal of this paper is to show how the energy transition is creating even stronger interdependencies between the technological and institutional sub-systems that require a more integrated approach to research and policy making. Carbon reductions in transport and heating will require a shift towards electricity as their main energy carrier - a notion generally referred to as electrification These considerations justify a limitation of the scope of this paper to the integration of RES in the power system. We conclude by summarizing the most important elements of this paper and its implications for research and policy making
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