An advanced reliability reserve incentivizes flexibility investments while safeguarding the electricity market
Franziska Klaucke, Karsten Neuhoff, Alexander Roth, Wolf-Peter Schill, Leon Stolle · 2026
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Description
Franziska Klaucke and co-authors present a 2026 modeling study of how Germany might keep the power supply secure as wind and solar grow. The country is weighing schemes that pay plants to stand ready as backup. The authors compare a central capacity market against a reliability reserve that kicks in at a fairly high price.
Using a detailed expansion model set in 2030, they found the capacity market caps wholesale prices and thereby dulls the urge to invest in flexible demand. The reserve design prompted seven times more flexibility investment in energy-hungry industry and double the investment in district heating storage. Supply stayed secure at similar overall cost. The authors suggest the reserve could help new flexibility tools mature on the path to climate neutrality.
Catalog record
| CREATOR | Franziska Klaucke, Karsten Neuhoff, Alexander Roth, Wolf-Peter Schill, Leon Stolle |
|---|---|
| YEAR | 2026 |
| COLLECTION | PAPERS |
| FORMAT | TXT |
| FILE SIZE | 56 KB |
| VERSION | 1.0 |
| LICENSE | CC BY 4.0 |
| RIGHTS | CC BY |
| SOURCE | Europe PMC |