The hidden power of water: flexibility

News Article

By 2050 the flexibility needs of the EU power sector will amount to Germany’s annual power production. This may sound a huge amount – and it is.

The reasons for such a high demand for flexibility in the system are clear. With weather-dependent wind and solar photovoltaics (PV) becoming predominant energy sources, the variability in the electricity system will massively increase, and with it, the need to adapt to fluctuations in supply and demand to ensure a reliable supply of power across Europe 24/7.

To put this in numbers, a recent study conducted by the European Commission's Joint Research Centre indicates that Europe is approaching a tipping point where flexibility demand is expected to increase exponentially, reaching up to 30% of the total electricity demand by 2050. Based on our Decarbonisation study’s latest demand projections for 2040, this flexibility requirement could amount to nearly 1,000 TWh per year.

Today, hydropower as a major renewable energy source (RES), significantly contributes to covering flexibility demands. As we said in our previous article, when the sun doesn’t shine and the wind doesn’t blow, water keeps flowing.

Tomorrow, hydropower, and above all, pumped storage, will still make up a major share of flexibility needs in Europe, followed by innovative storage solutions and vehicle-to-grid technologies. 

Hydropower can provide flexible electricity generation and storage capacity on a large scale through three distinct power plant types – as shown in our fourth hydropower short story.

Run-of-river hydropower

This hydro technology channels the water of a river through turbines, and thus, supplies a continuous amount of electricity linked to the river's discharge. These kinds of plants can provide flexibility services to cover short-term up to daily fluctuations in power demand by adjusting their operation parameters in a certain range.

Reservoir hydropower

Reservoirs accumulate water during periods of abundance. These strategic reserves enable flexible power generation for longer time horizons, ranging from weeks up to a year, irrespective of prevailing natural discharge conditions. This is why reservoir hydropower stands as the predominant renewable source for short, medium, and long-term flexibility requirements.

Pumped storage hydropower

As described in our previous article, pumped storage plants are by far the most efficient source of electricity storage. This technology harnesses the power of water by cycling it between a lower and upper reservoir. During periods of surplus power, pumps act as flexible absorbers, lifting water to the upper reservoir. Conversely, when electricity demand peaks, water is released from the upper reservoir, facilitating flexible electricity generation. The storage capacity varies depending on the system's size, ranging from short-term to long-term, potentially spanning several months.

These plants work with much higher efficiency compared to hydrogen technologies and on a larger scale than batteries. In addition, they can be designed and built in a sustainable way at affordable costs. Today, they provide more than 90% of the EU’s storage capacity and will remain the number one storage solution in the future.

In many hydropower schemes these different plant types are strategically combined and operated to harness the maximum energy output from the available water while keeping the environmental impact to a minimum.

Let it flex

To meet tomorrow's flexibility demand and fully exploit hydropower potential, a technology-neutral stable regulatory environment is needed. Clear regulation can ensure long-term visibility and raise confidence of plant owners, operators and investors. To this end, market interventions should be avoided in order to maintain the market signals that enable efficient dispatch and storage of electricity. In other words, flexible sources are activated when they offer the greatest value to the electricity system. Obstructing these price signals would thus be highly detrimental for investments in flexibility.

Moreover, while public support mechanisms can provide short-term signals and catalyse long-term investments in hydropower, they must align with existing regulations. This allows flexible plants to maximise their incomes on various markets.

Investing in emerging technologies is undoubtedly significant; however, to ensure a successful and timely energy transition, it is crucial to recognise and reinforce established and mature technologies like hydropower to their fullest potential. Investments should therefore not only target new constructions but also focus on optimising and expanding the utilisation of existing hydropower assets. This can be achieved by refurbishing existing plants and building new ones that take advantage of this mature but still cutting-edge technology.

So let it flow.