Flexibility is a key topic regarding the power industry of the future. In a nutshell it’s about when and how electricity is consumed and generated. Flexibility as such can be interpreted in view of technical, economical or legal aspects, as well. In this thesis I examine it in the aspect of power and frequency control. Traditionally, the flexibility is provided by power plants, however many new disruptive innovation is under development, which can lead us to a more environment-friendly future energy sector, while maintaining the cost of security of supply at a low level.
In the first section of this paper I give a brief overview about the power networks, markets and the related regulation with the definition of flexibility. Important part of the examination is the overview of the ENTSO-E network codes and the new ‘Winter Package’. Beside an analysis of load curve gradients, the primary, secondary and tertiary markets are presented and throughly investigated, including the price of balancing energy. I have developed an algorithm that can to select the proper offers on the reserve market for procurement. The ultimate goal of this section is to find the connection between the market participants and the publicly availble, but anonimzed offers.
In the end of the paper I analyze the options as transactions. Taking into account international market examples and global trends, I define some possible option product for the Hungarian reserve market. As a final conclusion, it can be determined that in the future the need for flexibility will be even higher.