Flexibility and storage at the core of resilient power systems: new FAQs unpack key concepts and trends
As power systems transform, two new FAQs explain flexibility and battery storage – critical elements of a secure, cost-effective and climate-neutral system.
Recent disruptions around the Strait of Hormuz have once again highlighted the importance of resilient and adaptable power systems. Expanding renewable energy can reduce dependence on imported fossil fuels and strengthen energy security. At the same time, higher shares of renewables, growing electrification and shifting demand patterns make it increasingly necessary for power systems to be able to respond effectively to both variable conditions and external shocks. Traditionally, this has entailed gas-fired generation, which is commonly used as a peaking resource. However, volatile gas prices and exposure to geopolitical risks underscore the limitations of relying on such conventional sources. In this context, flexibility is becoming the defining requirement of future power systems with battery energy storage systems (BESS) emerging as one scalable and cost-effective solution.
To support a clearer understanding of these topics, Agora Energiewende’s two new FAQ-style resources provide comprehensive, fact-based answers to the most pressing questions around power system flexibility and (battery) storage. Aimed at policymakers, regulators, industry stakeholders, researchers and interested members of the public, the publications combine clear explanations with technical insights on how flexibility and BESS support resilient, efficient power systems. Real-world data and illustrative case studies help bring these concepts and trends to life, showing how flexibility and storage operate in practice around the world.
Adapting to a more dynamic power system
Power system flexibility refers to its ability to continuously balance supply and demand across timescales and locations. Every day, electricity systems must respond to millions of individual decisions. Flexibility is what enables the system to adapt in real time – whether responding to the sudden outage of a large power plant, managing simultaneous electric vehicle charging or integrating surplus renewable generation during periods of high solar output.
Flexibility is becoming increasingly critical, as both supply and demand are evolving more rapidly, more locally and more unpredictably than in the past. For decades, variability in power systems followed relatively stable and predictable patterns. Demand changed with daily and seasonal cycles, while baseload power plants operated at constant output. Peaking plants and hydropower absorbed fluctuations and system planning focused on meeting peak demand at the lowest cost.
However, this model is exposed to structural risks such as fuel supply disruptions, price volatility and dependence on a limited set of centralised assets – vulnerabilities made clear by the fossil energy crises triggered by geopolitical volatility. Today, with the rapid expansion of variable renewable energy and the electrification of transport, heating and industry, relying on a centralised, fossil fuel-based system is no longer fit for purpose. A more flexible system is essential to ensure reliability and efficiency under increasingly complex conditions.
Battery storage as a cornerstone technology
Battery energy storage systems are emerging as an important enabler of this new power system paradigm. Globally, BESS deployment is expanding at an unprecedented pace, driven by falling costs, supportive policy frameworks and the growing need to integrate renewable energy.
Battery storage can provide a wide range of services to the grid, from short-term balancing and frequency regulation to energy shifting and capacity adequacy. By storing excess renewable electricity and discharging it when needed, batteries help smooth variability, reduce curtailment and enhance system stability. At the same time, they can defer costly grid investments and contribute to more efficient system operation.
While solar photovoltaics combined with battery storage can technically provide 24/7 dispatchable power and already compete with new fossil gas plants in many contexts, the most cost-effective pathway to clean power systems lies in a broader portfolio approach. Combining co-located solar and batteries with other renewable technologies, demand-side response and wider grid flexibility can improve overall system performance, resilience and efficiency.
A comprehensive resource for a transforming sector
The FAQs explore the various flexibility solutions and storage technologies in use around the world, assessing their role in different contexts, alongside key questions around economics, market design, business models and deployment trends. They also examine how storage interacts with other flexibility options, such as demand-side response, interconnection and flexible generation.
The two new publications provide a structured overview of the concepts, technologies and policy considerations shaping modern power systems. Covering a broad range of questions and perspectives, they are designed as a go-to reference for anyone seeking to understand how flexibility and storage contribute to a secure, cost-effective and climate-neutral power system.
As the energy transition progresses and power systems face new challenges and constraints, these FAQs offer clear, fact-based guidance to inform policy and investment decisions. What you always wanted to know about flexibility and What you always wanted to know about battery storage are available for free at www.agora-energiewende.org and down below.
