Key insights from the Flexibility chapter

• As the energy system changes, the flexibility challenges it faces will also change:

  • Increasingly peak demand will not be the only driver of system stress – it will be driven as much by peaks and troughs of electricity supply as by peak demand.

  • Electrification of other sectors will increase the scale of electricity flexibility needed.

  • Large amounts of flexibility with duration of a few hours will be needed to match supply and demand within day. This includes up to 35 GW of electricity storage with an average discharge duration of less than 4 hours by 2050.

  • Flexibility from unabated natural gas will significantly reduce as the energy system decarbonises, so new ways will need to be found to deliver the services historically provided by unabated gas.

• New solutions are needed to meet these developing challenges:

  • Demand side flexibility will be increasingly important in an electrified, renewable world, increasing from around 6 GW today to potentially over 100 GW by 2050. It is used both to turn up demand when supply is high and to turn it down or shift demand when supply is lower.

  • Hydrogen, energy storage and interconnectors will all also contribute to future flexibility, although there is still uncertainty around exact roles.

  • Large-scale inter-seasonal energy storage improves Security of Supply and is essential to meeting Net Zero, but the amount needed (between 11-56 TWh in 2050 under Net Zero scenarios) is dependent on the rollout of hydrogen (for example for heating and industry), hydrogen storage, and other sources of flexibility available in each modelled scenario.

• High levels of wind capacity can, on windy days, lead to high levels of curtailment, peaking at over 80 TWh under System Transformation in the mid-2030’s. To avoid curtailment, flexible solutions such as energy storage, interconnectors, Demand Side Response (DSR) or electrolysis could be used to maximise the use of renewable electricity.

• The location of flexibility is a key consideration: flexibility can deliver more value in some locations than others. For example, electrolysers may be sited close to renewable generation and network constraints, or storage may be co-located with renewables. Appropriate and tailored price signals and incentives will be needed from policy and the energy market to encourage these new solutions, from flexible DSR to inter-seasonal storage.

• To meet Net Zero an increasing need to balance renewable generation with demand and a reduced reliance on unabated natural gas means additional sources of flexibility will need to be deployed. Strong market signals and the correct enabling conditions, such as locational pricing, increased digitalisation and a coordinated demand side strategy are needed to ensure the right types of flexibility are in the right places, at the right time. This requirement forms a key part of the case for change in our Net Zero Market Reform work.

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