Dynamic zonal flexibility markets for congestion management: optimising distribution grid capacity

The integration of volatile renewable energy sources into the electric grid and the corresponding rise in power demand due to electrification is creating challenges for congestion management (CM). CM aims at optimising the grid capacity utilisation and thereby enables hosting more distributed energy resources. Flexible resources have the potential to reduce the costs associated with CM, which raises the demand for an efficient framework for trading flexibility. The aggregated flexibility from stakeholders such as energy communities serves for valid bids into large-scale flexibility markets. This paper develops a market design aimed at improving CM by examining the concept of zonal flexibility. The design utilises zones that are dynamically allocated based on grid congestion after the day-ahead market. The proposed market design is compared to both the optimal utilisation of flexible resources and to conventional redispatch in order to evaluate its economic efficiency. Our findings indicate that it performs close to a nodal flexibility market. Future work needs to develop more refined partitioning algorithms to stabilise the performance across various scenarios.