Challenges and opportunities ahead for electricity security

. The challenge for policy makers and system planners is to update policies, regulation and market design features to ensure that power systems remain secure throughout their clean energy transitions.

Experience in a number of countries has shown that variable renewables can be reliably integrated in power systems. Many countries and regions in many parts of the world have succeeded in this task using different approaches and taking advantage of their flexibility resources. They leave to the world a large set of tools and lessons to be integrated into the policy maker toolkit.

Making the best use of existing flexibility assets and ensuring these are kept when needed should be a policy priority. This will require market and regulatory reforms to better reward all forms of flexibility as well as careful adequacy assessments of the impact of decommissioning plans of dispatchable supplies.

However, going forward, new additional flexibility resources need to develop in parallel with expanding solar and wind, especially in emerging and developing economies that are facing strong electricity demand growth. Maintaining reliability in the face of greater supply and demand variability will require greater and more timely investments in networks and flexible resources – including demand side, distributed, and storage resources – to ensure that power systems are sufficiently flexible and diverse at all times.

Notably, current investment trends do not support such requirements and will need to be upgraded accordingly, sooner rather than later. Grids are a particular concern, as investment has been decreasing by 16.3% since 2015. Grids also require long-term planning, have long construction lead times and often face social acceptance issues.

Building new assets to provide needed adequacy and flexibility will require an update to market design. Increased reliance on renewables will augment the need for technologies that provide flexibility and adequacy to the system. This will include storage, interconnections, natural gas-fired plants in many regions, and demand-side response enabled by digitalisation. Updated approaches to planning will also be necessary, with more advanced probabilistic analyses that account for and enable contributions from all available technologies to adequacy.