Methodology to assess prosumer participation in European electricity markets

Abstract

The emergence of distributed generation and the electrification of demand have opened the possibility for prosumers to participate in electricity markets, receiving economic benefits on their bills and contributing to the reduction of carbon emissions, aligning with United Nations Sustainable Development Goal 7. Consumers and prosumers can participate through implicit and explicit demand flexibility and (collective) self-consumption. This study analyses the potential markets in which prosumers can participate and indicates whether these are currently open. The markets studied include day-ahead, intraday, ancillary services, adequacy services, constraint management, and local flexibility markets. Additionally, collective self-consumption is analysed as a service through which prosumers can participate in the electricity market. Previous studies are usually focused on a single market or in a single country, making impossible a complete comparison. This analysis has been done in Spain, Italy, Croatia, and the United Kingdom as representative countries to obtain a methodology to assess countries' openness to prosumer participation in electricity markets, comparing regulatory frameworks and assigning scores based on their prosumer inclusion across various markets. This work updates current literature reviews with the changes and a new description of local market designs in Spain. This methodology can be used to compare other countries' grade of openness. The results of this study show that the analysed countries can be categorised into three groups: almost open, partially open, and closed markets. Analysing the differences, recommendations on the following steps to foster user participation are suggested for each group.The emergence of distributed generation and the electrification of demand have opened the possibility for prosumers to participate in electricity markets, receiving economic benefits on their bills and contributing to the reduction of carbon emissions, aligning with United Nations Sustainable Development Goal 7. Consumers and prosumers can participate through implicit and explicit demand flexibility and (collective) self-consumption. This study analyses the potential markets in which prosumers can participate and indicates whether these are currently open. The markets studied include day-ahead, intraday, ancillary services, adequacy services, constraint management, and local flexibility markets. Additionally, collective self-consumption is analysed as a service through which prosumers can participate in the electricity market. Previous studies are usually focused on a single market or in a single country, making impossible a complete comparison. This analysis has been done in Spain, Italy, Croatia, and the United Kingdom as representative countries to obtain a methodology to assess countries' openness to prosumer participation in electricity markets, comparing regulatory frameworks and assigning scores based on their prosumer inclusion across various markets. This work updates current literature reviews with the changes and a new description of local market designs in Spain. This methodology can be used to compare other countries' grade of openness. The results of this study show that the analysed countries can be categorised into three groups: almost open, partially open, and closed markets. Analysing the differences, recommendations on the following steps to foster user participation are suggested for each group.