IEEE Power & Energy Magazine - July/August 2021 - 84

integrated design. This comes at the price of iterative market
clearing and increased communication costs between
market operators. However, for practical applications, many
questions remain in terms of the implementation of the proposed
concept or at least parts of it. See Torbaghan et al. in
the " For Further Reading " section on innovative multicarrier
market designs and algorithms.
Main Lessons Learned
MESs can certainly provide flexibility to the electricity system.
Examples are given in previous sections and in Figures
6 and 7. Depending on the type of MES and the technologies
involved, the volume of flexibility available for trading
in the frequency regulation markets may be significant compared
with the energy traded in the day-ahead market. For
instance, for the ACS case study presented previously, it can
even reach twice the amount of energy traded the day ahead.
However, this may have to be achieved through increased use
of more expensive technologies and therefore might significantly
increase operating costs. There are limitations from
the technological aspect and the market and regulatory perspectives.
This section summarizes some of the main lessons
that could be drawn in terms of the provision of bottom-up
flexibility from MESs, particularly those that emerged from
the MAGNITUDE project.
Technological Perspectives
The priority of MES operation is to satisfy the needs of an
underlying physical process, e.g., to supply heat or cooling
to consumers, produce paper or steel, and treat wastewater.
This imposes constraints on the provision of flexibility. In
this respect, storage devices (e.g., thermal and gas) can have
significant benefits by decoupling the production and consumption
aspects inside an MES. The increase of available
table 4. A comparison of the two proposed
multicarrier market designs.
Market Design
Indicator
Number
of market
operators
Economic
efficiency*
Confidentiality
level
†
High Low
†*The sum of economic surpluses across all market parties.
The level of detail of information about the technical and
economic constraints of the underlying portfolio of the
market participants that needs to be shared with the market
operator.
84
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Decoupled
Integrated
One per carrier One
Integrated
Decentralized
One per
carrier
flexibility greatly depends on the MES type and its operation
strategy. For instance, in the case studies, increases of
the available flexibility from a few percent (e.g., 6.5%) up
to 250% could be observed. Depending on the case, storage
devices may also reduce operating costs. Another associated
limitation comes from the highly seasonal nature of some
MES loads, linked with the underlying process. District
heating and cooling systems are good examples, as in Figure 7.
The products traded in different markets (e.g., frequency
regulation markets, such as for FCR, aFRR, and mFFR) may
have technical requirements (e.g., maximum full activation
times, minimum duration-of-service provisions, and symmetric
products) that are not compatible with the actual ability of
some technologies. The integrated management of different
technologies at the level of an MES site may partially overcome
such limitations. At a higher level, the aggregation of
an MES within a more general portfolio with other flexible
resources enables the provision of market products that the
MES alone could not provide. Finally, the provision of flexibility
may need more frequent starts and stops for different
plant devices as well as operational ramps that may impact the
lifetime of equipment. The impact of flexibility provision on
the aging of equipment is necessary to analyze. The relevant
decision-making algorithms must include the associated costs.
Market and Regulatory Perspectives
The detailed analysis carried out on the procurement of the
selected services in the case studies showed a large diversity
of market mechanisms and rules between the considered
countries and between energy sectors. We can observe similarities
for day-ahead mechanisms in electricity systems,
thanks to day-ahead market coupling and transnational
trading platforms. However, there is much more diversity
for intraday markets and even more for frequency control
and balancing. For instance, depending on the country, for
aFRR, the required full activation time may vary from 2 to
15 min and the minimum bid size from 1 to 5 MW. This
should improve due to ongoing harmonization processes led
by market operators for intraday transactions and by European
transmission system operators for the procurement of
balancing and frequency regulation services.
Significant differences remain for balancing/imbalance
pricing, congestion management, and capacity mechanisms.
For example, capacity mechanisms may take various forms,
such as organized markets, capacity payments, and strategic
reserves. In some countries, capacity mechanisms do not
exist. There is also a large diversity of mechanisms in the gas
sector. That is even more true for heat networks, where there
is no unbundling, and we can see rather heterogeneous situations
from one area to another (within the same country)
and even from one MES to another. Also, some electricity
market rules may prevent or limit service provision by an
MES, for instance, restricted access to some technologies,
minimum bid sizes (see the preceding example for aFRR),
and the prohibition of full aggregation.
july/august 2021
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