Next Article in Journal
Feasibility of Bifacial Photovoltaics in Transport Infrastructure
Previous Article in Journal
Reduced-Order Model for Bearingless PMSMs in Hardware-in-the-Loop
Previous Article in Special Issue
Innovations for Holistic and Sustainable Transitions
 
 
Font Type:
Arial Georgia Verdana
Font Size:
Aa Aa Aa
Line Spacing:
Column Width:
Background:
Article

Feasibility Analysis of Storage and Renewable Energy Ancillary Services for Grid Operations

1
School of Environmental Sciences, University of Haifa, Abba Khoushy Ave 199, Haifa 3498838, Israel
2
Natural Resources and Environmental Research Center, University of Haifa, Abba Khoushy Ave 199, Haifa 3498838, Israel
*
Authors to whom correspondence should be addressed.
Energies 2025, 18(11), 2836; https://doi.org/10.3390/en18112836
Submission received: 4 May 2025 / Revised: 25 May 2025 / Accepted: 27 May 2025 / Published: 29 May 2025
(This article belongs to the Special Issue Energy and Environmental Economic Theory and Policy)

Abstract

:
This study examines the feasibility of deploying renewable energy sources and storage systems to provide ancillary services (ASs), traditionally supplied by conventional power systems, in an electric-island power grid. As renewable energy penetration grows, grid stability becomes increasingly challenged as reduced system inertia and higher variability occur. The study focuses on Israel, which currently lacks operational AS markets. This research explores regulatory, economic, and technical mechanisms to enable renewables and storage systems to provide such services, using a comparative analysis of Germany and California, US, as use cases, along with interview analysis with experts from the Israeli energy sector. The findings highlight, on the one hand, notable regulatory and infrastructural barriers limiting the ability of alternative sources to provide ancillary services. On the other hand, the feasibility and importance of integrating renewables and storage, as regulatory adjustments, market-based procurement mechanisms, and incentive schemes, are to be undertaken. Adopting a structured AS market in Israel, influenced by international best practices, can improve grid resilience, allowing higher renewable integration and supporting long-term energy security and sustainability.

1. Introduction

Energy is the driving force of life as we know it. Without energy, in general, and electricity specifically, we cannot develop and evolve. Economic growth cannot occur without energy security. Electricity demand is rising globally, and consumption per capita increases annually [1], leading to a necessity for ensuring people have access to a secure, safe, and continuous energy supply while ensuring energy efficiency.
Moreover, the increasing recognition of climate change has engendered a collective aspiration to allocate resources and implement an expanding array of ecologically sustainable energy generation facilities. Such endeavours constitute a crucial component of the initiatives undertaken to combat and mitigate the anthropogenic impacts of climate change, as stipulated in both the Paris Agreement [2] and the deliberations held at the Glasgow summit [3].
In 2023, more than 473 GW of new renewable energy sources (RESs) worldwide were installed compared to 2022, which puts the new world’s capacity at 3864 GW [4]. The RES share is projected to reach up to 88% by 2050 [5], leading to more frequent grid disturbances [6].

1.1. Electricity and Power Grid Characteristics

Unlike physical goods, electricity is challenging and costly to store. Power grids require a delicate balance between production and consumption.
The power grid is a complex system involving transmission and distribution systems, categorised by voltage levels (ultra-high, high, medium, and low). Voltage standards vary between countries. Voltage is a key factor in the system’s operation, representing the energy flow potential. Energy generated by power plants must be matched to the voltage level they are connected to, to ensure efficient transmission [7].
For example, in the U.S., American National Standards Institute (ANSI) C84.1 sets these standards [8], while in Europe Regulation (EC) No. 714/2009 applies [9]. In Israel, the Electrical Bill and the 1985 Electrical Ordinance define these levels [10].
Load represents the electricity consumed, and frequency measured in hertz (Hz), reflects the operational cycle of alternating current (AC) systems. For instance, the standard frequency in Europe and Israel is 50 Hz [11,12], whereas in the U.S., it is 60 Hz [8].
This means that a certain amount of electricity must be balanced to keep the electric system operational, whereas voltage and frequency must remain between pre-determined specifications [1]. This amount varies depending on the size of the power grid and the number of users. Voltage and frequency are interdependent in grid operations. Though designed separately, faults in the grid can cause simultaneous issues in both [13].
Historically, large-scale generation units with synchronous generators (SGs) dominated the power supply. These generators, found in coal, gas, and hydroelectric plants, provide grid stability through their mechanical inertia, which weakens the impact of frequency disturbances. However, as RESs like wind and solar power replace conventional plants, inertia declines, leading to increased frequency and voltage fluctuations [14].
Distributed generation (DG) units, typically renewable-based, often combined with storage systems (StSys), and small-scale, support grid efficiency enhancement, promote RES as part of the decarbonisation, and provide independence [15]. DG units provide peak support during high-demand periods, improve reliability [16], and offer a cost-effective alternative to grid expansion. In many cases, RES-based generation is cheaper than fossil fuel generation when battery storage is not included [17].

1.2. Energy from Renewable Sources Implications on the Power Grid

The growing share of RES imposes difficulties for the power grids to balance loads due to variable renewable energy (VRE) power generation units, i.e., mainly photovoltaic (PV) and wind power [18]. This variability (also referred to as intermittent) necessitates the availability of reserve capacity, or backup power, to be activated during faults or demand imbalances [19].
Although problematic, VRE entails some characteristics, having the potential to provide operational support for the power grid and support for efficient power chain supply. For instance, those power systems produce electricity much cheaper than conventional generation units during generation periods, and they usually have a much lower capacity factor than conventional units, allowing a much more desirable switch-off/on measures for grid imbalances [18]. In addition, studies suggest that distributed energy resources (DERs), particularly distributed renewable energy sources (DRESs), can be competitive when aggregated and managed efficiently [20].
The loads within the electricity system must be kept in balance, meaning the amount generated should always be equal to the amount consumed. An increase or decrease in load or power will cause fluctuations in frequency, whereas loads and frequency are inversely proportional [21].
As VRE share within the system increases alongside consumption, load balancing becomes more elaborate, and more interventions by the system operator (SO) will be needed. Although RES generation is not controllable, switching measures are [1,22].
Deviation from acceptable frequency or voltage ranges, or system imbalances, can trigger blackouts, the scale of which depends on the voltage level and the coverage area. These risks highlight the critical need for enhanced grid resilience, defined as the power system’s capacity to withstand and recover from major unplanned events, such as extreme weather and system faults. Resilience can be assessed using metrics that quantify power outage reductions and restoration times [23].

1.3. Ancillary Services Definitions

These imbalances can be overcome using power-supporting measures, such as ancillary services (ASs). ASs are actions and functions aimed at helping electricity transmission and distribution system (i.e., power grid) operators maintain a reliable and secure electricity supply. They are defined as services provided to system operators (SOs) to maintain the operation of power grids within certain boundaries of security and delivery times. They are mainly delivered by third parties or SOs operating at different grid levels, i.e., low to high voltage levels [6]. AS are essential for maintaining grid stability and ensuring that voltage and frequency remain within acceptable boundaries. ASs are typically provided by third-party operators or system operators such as transmission system operators (TSOs) and distribution system operators (DSOs) [24].
The European Network of Transmission System Operators for Electricity (ENTSO-E) classifies AS into three categories under three “umbrella terms”: (i) frequency AS (e.g., balancing of demand and supply to prevent frequency deviations), (ii) services for congestion management, and (iii) non-frequency AS, namely voltage control (e.g., reactive power compensation—using reactive power to improve performance in an alternating current (AC) power system) and grid restoration (e.g., black start—the ability of a generation unit to bring back parts of the gird to operation after a blackout) [6]. Currently, most ASs being provided are measured to support frequency deviations and are being carried out upon requests of the TSO to generate unit owners to adjust the loads of their systems. Reactive power compensations, meaning adding positive or negative power to attain voltage control, occur not often and are usually carried out at the substations connecting the transmission grid and the distribution grid [21]. Other AS are being made available within the distribution grid and used to balance generation and consumption in that grid [25].
In Europe, ENTSO-E coordinates all TSO activities and coordinates communication between the several control areas on the continent [26]. The core responsibility of TSOs is maintaining grid stability, a task supported by various ASs. Frequency control and voltage control are critical in this regard. The increasing integration of DRESs into distribution grids creates technical challenges that can be mitigated by enabling different ASs [27]. With the growing power consumption and the replacement of conventional SGs, the system is expected to experience more grid disturbances. Economic and regulatory changes are necessary to support grid operations under these conditions [28].
Frequency control is vital for maintaining grid balance. TSOs manage to balance through various control services, which are activated depending on the urgency and duration of disturbances. Frequency containment reserve (FCR) responds within 30 s of a deviation and lasts up to 15 min, providing primary frequency regulation [19]. Secondary regulation, known as frequency restoration reserves (FRRs), includes automatic (aFRR), which starts after 30 s of a positive or negative deviation occurrence and should be achieved in full within five minutes from activation, and manual (mFRR), while mFRR supports aFRR, activating within 15 min [28]. Tertiary frequency regulation, or replacement reserve (RR), supports FRR and prepares for additional imbalances [29].
In Europe, frequency control services like FCR, FRR, and RR are provided through designated markets, and service-providing units must meet technical requirements set by ENTSO-E. When power imbalances occur, the reserves adjust active power to limit frequency deviations. A data exchange framework between TSOs, DSOs, and power-generating modules at the distribution level facilitates these control measures [19].
Each TSO sets specific data exchange standards, and transmission-connected units must comply [30]. A set of requirements was established to ensure that generation units can provide support, addressing different points of urgency [31]. Generation units must meet specific requirements to provide frequency support, but currently, these services are only available at the transmission level [32]. Frequency control services are provided by large-scale SGs connected to the transmission system. The service provision is facilitated through various contractual arrangements between TSOs, balancing service providers (BSPs), and DSOs [33,34,35].
Frequency control manages power demand-supply balance, with balancing markets trading frequency support services. Europe, divided into five synchronous zones, defines frequency reserves, activation processes, reserve sizing, actors, imbalances settlements, and balancing activation. TSOs are the sole buyers, with BSPs or reserve-providing unit owners as service providers. Remuneration schemes vary based on urgency, contract periods, activation duration, etc. [36].
Remuneration schemes are country-specific; in Germany, procurement occurs on designated markets in four-hour tender forms, with FCR paid-as-cleared and aFRR/mFRR pay-as-bid, prices determined by the merit-order curve [37]. Price signals are shared across synchronous areas in Europe [38].
Congestion occurs when transmission lines are overloaded, often due to the limitations of competitive markets and transmission infrastructure [39]. There are three types of congestion: (i) market—meaning economic surplus limitation, (ii) physical—meaning power system operation limitations, including voltage stability, and (iii) structural—meaning recurring events under normal operation conditions [40].
Services for congestion management ensure that power is efficiently distributed, keeping operational limits via a more efficient allocation. These services are often achieved by leveraging the flexibility of the power system [6,41,42,43,44] and are defined as redispatch, feed-in management, and grid reserve provision. They address congestion issues by adjusting generation schedules or curtailing renewable energy feed-in [45,46,47].
Redispatch involves rescheduling generation to match grid constraints [48]. Feed-in management controls the amount of electricity fed into the grid, particularly from RES and DG [22], whereas SO communicates to generators the amount and duration needed [49,50]. Grid reserve provision relies on designated power plants that are not active in normal market operations but are available to address redispatch needs within a short timeframe [51]. Participation requirements are analysed yearly and based on forecasted needs and RE growth [52].
Electric vehicles and heat pumps are considered controllable loads, along with the rise in DG, increasing the need for congestion management solutions [53]. Controllable loads are adjusted based on grid conditions and considered flexible [54]. Curtailment is the primary measure to reduce power reductions caused by congestion [55].
Flexibility, critical in European research projects, is procured via market and aggregator platforms, offering flexibility to DSOs, TSOs, or aggregators. Flexibility services generally address local grid congestion, requiring SO access to information on local services and asset owners, which is not available in regular energy markets and necessitates a local flexibility control mechanism [56].
Voltage control keeps the voltage within predefined limits and is usually achieved via reactive power management [57]. It operates on three levels: (i) primary voltage control is automatically activated within milliseconds and lasts up to one minute after a voltage deviation occurs (ii) secondary voltage control is automatically activated after one minute and lasts for several minutes after a deviation and (iii) tertiary voltage control activated after 10 min and lasts up to 30 min [29].
Automated voltage regulators and static compensators must be installed for these services to be made available via techniques such as curtailment, utilising StSy, and demand side management [57]. System restoration or grid restoration involves actions to restore the system after a fault. It includes, for instance, black start, provided by designated systems, e.g., black-start-capable units, such as conventional power, pumped-storage power plants, and hydropower plants [24,58].
Voltage support remuneration mirrors frequency support, with settlements via pay-as-bid, marginal pricing, or regulated prices. Voltage support includes mandatory and additional regulation, though TSOs mandate voltage support across most European nations; not all remunerate it [29].
Reactive power compensation, a core voltage control element, relates to the active power amount fed into the system, with remuneration at the national level depending on the generation system [59].

1.4. Ancillary Services Trading

AS are traded on designated markets, e.g., balancing markets or via bilateral agreements. Those markets are tailored for conventional energy sources, such as fossil or nuclear [60].
DSO-TSO coordination is essential for effective power supply with increasing DG systems. AS procurement is conducted through five models: a centralised TSO-operated AS market, a local DSO-operated AS market with priority for local resources, a shared balancing responsibility model with TSO for transmission and DSO for distribution levels, a common TSO-DSO market, and an integrated flexibility market open to SO and non-SO entities, requiring a neutral market operator [61].
There are two main mechanisms for trading power and occur either on a (i) forward market, as a commitment to supply a certain amount of power, and (ii) real-time markets aiming at providing support to the power supply if the pre-planned amount of power (i.e., on the forward market) does not fully satisfies the market’s needs. Energy is usually traded on the forward markets, whereas ASs are traded in both forward and real-time markets [62].
The supply and demand consist of various resources, conventional and renewable. The ordering of the different sources is being made regarding how much power the sources can provide and at what prices, which depends on technology and fuel. It is worth mentioning that although solar and wind are considered cheaper as their marginal costs of production are very low, large-scale capacity is less economically viable than conventional sources [63]. While reducing the wholesale prices is beneficial for end-users, RES can cause technical and economic challenges in what is called a merit-order effect [64].
ASs are traded on designated markets, e.g., balancing markets or via bilateral agreements. Current AS markets are tailored for conventional energy sources, such as fossil or nuclear [59]. These markets are operated by TSOs, which solely purchase AS products, and sellers own prequalified power generation systems, large demand response entities, consumers, and aggregators. AS offers are typically annual, while available capacity is offered daily. Balancing processes in AS markets aim to keep the frequency stable through (i) TSO-determined scheduling and dispatching of generation and consumption, (ii) aggregated power schedules by asset scheduling agents, and (iii) a “self-operating” process where generation and consumption follow self-determined schedules [29].
Electricity markets define the roles of participating parties, including AS roles, ensuring non-discrimination and transparency [65,66].

2. Research Framing

In Europe, centralised markets like the European Energy Exchange manage electricity trading [63], with TSOs coordinating grid events and managing the balancing market [33].
In the United States, power is traded in wholesale markets operated by independent system operators (ISOs) and regional transmission organisations (RTOs) using auction-based procurement [67]. AS are traded within these markets, operated by the ISOs/RTOs [68].
In Israel, the power grid is operated by a single SO, i.e., the Israeli Independent System Operator (NOGA). NOGA sets the operation and loading of the production units alongside the AS [69]. However, distributed renewable generation can now be dispatched without the involvement of NOGA.
Israel operates as an electric island. This type of operation leads to challenges in terms of continuous and safe operation and grid stabilisation. This includes land scarcity limiting RES potential, climate risks to infrastructure, and increased dependency on local generation and storage [70,71,72]. In addition, RESs are getting prioritised in the loading schedule due to policy obligations set by the regulatory authority, as the goal of the energy mix is to become more sustainable while reducing emissions and supporting environmental protection objectives. In 2023 RES reached 12.5% of total consumption, with plans to reach 30% by 2030, mainly via solar power [73,74].
This study examines the potential for deploying RESs and StSys to provide qualitative ASs in Israel’s power grid, which operates as an electric-island system and currently lacks functional AS markets. The existing literature focuses primarily on AS integration in connected grids with mature regulatory and market mechanisms. This work addresses a research gap by examining the feasibility of implementing RES- and StSy-based AS regulatory framework and pricing structures necessary for the Israeli context. The research investigates how such systems can replace conventional generation and demand-side mechanisms in providing ASs, while considering DRESs and how higher shares can be integrated without compromising grid stability.
In contrast to other studies, this paper addresses Israel’s unique situation by examining the specific regulatory and technical conditions, including the absence of market-based remuneration for storage, the exclusion of RESs and StSys from reserve provision, constraints on private participation in provision, and grid congestions due to peripheral generations. Additionally, this study aims to provide actionable recommendations to Israeli regulators.
Therefore, this paper focuses on the question of whether renewable energy sources (RESs) can provide qualitative ancillary services to the power grid currently provided by conventional plants and demand-side, and if so, what is the required regulation and suggested pricing mechanism needed to be implemented for it to be successfully deployed in Israel.

3. Methodologies

This study employed a comparative case study approach to examine ancillary service (AS) provision schemes in Germany, California, and Israel, focusing on the integration and remuneration of renewable energy sources (RESs) in supporting grid operations.
Germany and California were selected as benchmark cases due to their advanced electricity markets and high RES penetration. Germany represents a transnational grid with mature AS-trading frameworks, enabling participation from diverse actors, including RES. California, like Israel, operates under an independent system operator (ISO) model and exhibits comparable climatic conditions, particularly regarding solar energy reliance. These two systems offer insights into competitive procurement schemes, flexibility in product deployment, and regulatory structures, providing transferable lessons for the Israeli context.
To complement the comparative analysis, 13 semi-structured interviews were conducted with stakeholders in Israel’s electricity sector. Participants included representatives from the Israel Electric Corporation, NOGA (the system operator), the Electricity Authority, the Ministry of Energy, and private sector experts. Recruitment was achieved via a national energy community platform and direct outreach, ensuring a diverse and informed respondent pool.
Interview questions focused on the feasibility of integrating RES and storage in AS provision, regulatory and pricing challenges, and opportunities for market innovation.
Data were manually analysed through thematic analysis, guided by a coding framework that identified major themes (e.g., regulatory barriers, economic feasibility, and technological readiness). Recurring viewpoints were categorised and synthesised into a narrative framework to highlight patterns and cross-cutting insights.
The research protocol, including the semi-structured questionnaire, was approved by the Faculty of Social Sciences Ethics Committee at the University of Haifa (Approval #152/23, issued 7 May 2023).

4. Results

4.1. Comparative Analysis

Across the world, many countries have established operating markets and provision schemes to host and trade ASs. The section begins with an overview of the Israeli electricity market, underpinning the specific challenges and regulatory gaps to be addressed for the development of AS markets in the country. Further, we selected Germany and California, U.S., in order to derive key parameters for the implementation of such a mechanism in Israel. Both grids and country/state have well-established provision schemes. Germany has a well-established, mature AS mechanism and a strong, operable market, allowing various participating entities to supply services. Besides the functionality of their AS mechanism, the California Independent System Operator (CAISO) case has some similarities to Israel, considering its “island” operability and the climate, which is similar when considering RE, with a focus on solar power. Israel is an electricity island due to its geopolitical isolation and lack of cross-border energy connection, and requiring self-reliant configurations and a self-managed system.

4.1.1. The Israeli Power Grid Energy Market and Ancillary Services

Power Generation in Israel

The power system in Israel relies predominantly on natural gas, accounting for 70% of total generation. Coal experiences a significant reduction from 60% in 2012 to 17% in 2023 [75]. This reduction correlates to the government’s resolution [76] to decommission coal-based power plants and shift towards more environmentally friendly and sustainable gas-powered and RES electricity generation. In 2023, the total installed capacity in Israel was 23.7 GW. In recent years, RES installations have increased significantly. By the end of 2023, Israel had connected an additional 1.1 GW of RE, primarily PV, resulting in RE consumption of ca. 12.5%. The consumption potential is higher, reaching 14.6%. Solar power dominates the RE mix, with approximately 80%. RES is expected to experience further growth, reaching an installed capacity of ca. 8 GW by 2025 and 16 GW by 2030. RES shows varied patterns depending on the season. In summer, RES can reach 3.3 GWh at peak times, while generation capabilities in the transition seasons can strongly vary from 10% to 50% of nominal capacity [75]. Israel’s growing population and electricity demand will require ongoing capacity expansions, particularly in renewable energy [74].
The Israeli government has set a target goal of having 30% RE in the energy mix by 2030, relying mainly on solar, with more than 17 GW of solar capacity expected to be installed, which requires careful area planning and regulatory adaptations. This goal was set after delays in meeting earlier goals due to regulatory challenges, infrastructure limitations, COVID-19, and limitations in connecting new large-scale solar plants to the grid [77]. Israel’s energy sector has been examined, focusing on its isolated grid system and the need for internal energy resilience [78]. Operating as a political energy island, it is crucial to strengthen ancillary services such as storage and flexible grid management to maintain system stability [78]. Concurrently, dual-use land strategies are promoted, and the government supports renewable energy expansions [73], whereas broader installations of ground-mounted solar are planned [77,79]. However, inadequate grid infrastructure and mismatch between RE generation and power demand complicate balancing, and necessitate AS further [73,77,80].

Current Ancillary Services Schemes in Israel

In March 2024, NOGA announced the first AS in Israel, aiming to improve the stability and reliability of the electricity grid by enabling a quick response mechanism to frequency fluctuations—fast frequency response (FFR) [81].
Frequency control in Israel follows global practices, with spinning reserves and synthetic inertia maintaining grid stability [80]. Congestion issues in the southern part of the grid, driven by rapid RES development, limit RE penetration [82], although the IEA publishes new installation caps for RE installations in different voltage levels [83], and publishes frequently updated information on this decision. While Israel’s RESs currently do not provide ASs, future plans include integrating StSys, like pumped storage, to support frequency control and congestion management [84].
FFR is the first step towards AS integration and deploying StSys for power grid stability improvements, whereas the SO will utilise a computerised commercial platform as part of the deployment process. This includes the StSy operations and the possible market entities’ participation in fulfilling the technical requirements. Regulations limit the full-scale utilisation of StSys, e.g., they are subject to the same market-based tariffs as generation units [83]. FFR will be procured on a periodic tender basis, whereas providers meet the required response times, a minimum energy change rate of 5% for the tender supply, and installation of registration equipment at a frequency of 1 Hz for real-time data transmission [81]. In the future, additional services and increases in StSys installed capacity are planned to ensure a fast response to frequency deviations. Furthermore, increasing RESs will be used to support reserves and grid balancing. RESs will be combined with conventional systems for support, using incentives for private entrepreneurs and adjustments to the regulations [85]. By 2030, StSy’s 2300 MW installed capacity is planned for AS purposes, with 400 MW already required for 2023. However, the IEA did not publish proper regulations for promoting the installations of those StSys [86]. Moreover, clear criteria and long-term plans for using regulatory tools to allow implementations of RESs and StSys are missing, and there are uncertainties regarding the implications of new market mechanisms on the RE goals [77], showing a gap between legislation and actual implementation.
Congestion management aims at real-time interventions by adjusting power fluctuations. During times of need, service providers must communicate with their consumers to obtain updates regarding congestion status and details on specific fault locations. As a proactive approach, this model is supported by a load scheduling plan managed by the SO. This process entails a detailed analysis of available resources. The flexibility of certain power plants, especially RESs, is leveraged to autonomously ensure real-time adjustment by those systems, which are called self-loading systems. RESs are being prioritised according to national energy and environmental goals. Their loading order is organised based on their types. Systems with predictable generation or combined with StSys offering load shifting are given preference. Load scheduling also considers technical constraints, such as response speed, minimum load runtime, and switch-on/off speed. Self-producers operate primarily to meet their internal electricity demands, with self-loading as a core feature of their operations. These producers typically run in a stable “Must Run” mode and do not participate in reserve maintenance or AS except as mandated by their licenses [85]. Pumped storage facilities operate under fixed availability regulations and are crucial in supporting system operations. Payments are based on covering electricity purchase costs for pumping and generation processes, reflecting normative parameters recognised in their licenses [84].
Remuneration for feed-ins by self-loading systems, including RESs and compensation for load reductions, is established within a designated guideline. The guidelines include regulated tariffs to incentivise RES owners to remain available for fluctuation responses to demand. The tariffs vary based on the system producing, i.e., whether RE or conventional. Premiums for emission reductions are offered to RES owners as additional incentives. The SO issues a unified payment summary to ensure transparency, covering usage fees and services used per consumer load group. Failure to meet commitments to the grid may result in penalties [87].
Voltage regulation and reactive power support from RESs are made available through predefined technical requirements and operational protocols in the connection agreements with the generation units. Generation units are mandated to automatically provide reactive power compensation, using inverters when a deviation of ±1% from the nominal power boundaries occurs. This is achieved by using built-in automatic control systems capable of detecting fluctuations. The systems must provide and adjust reactive power as needed by using inverters. However, compensation is not available [88].
During 2023, the Israel Electricity Authority (IEA) updated measures to govern a voluntary load-shedding program complemented by tariff adjustments to ensure a reliable and continuous electricity supply. The main goal of this program is to ensure the grid’s stability during high-demand periods. This mechanism can be seen as a flexibility measure. Consumers can voluntarily reduce their consumption during times of need and be compensated for it. This is calculated by the product of the amount of energy curtailed and the timing of notifications to the consumers with several participation schemes for this flexibility provision, thereby contributing more to the grid’s stability. However, this program also includes penalties for consumers failing to meet their load reduction commitments. Under the updated regulations, suppliers who manage consumers in the program will receive compensation equivalent to 10% of the total payments made to their consumers for participating in load-shedding events, incentivising power generators to encourage them to participate. The updated measures also state that load-shedding may also be used for grid infrastructure constraints in addition to a shortage of generation, allowing a greater span of flexibility [89,90,91].
The share of each of the energy sources in the energy mix in Israel is illustrated in Figure 1:
The installed storage capacity can be seen in Figure 2:

Regulatory Framework for Ancillary Services Providers in Israel

Israel’s electricity production system comprises various producers operating under different regulatory frameworks. The multiplicity of regulations, particularly for conventional producers, complicates optimising unit allocation to minimise electricity production costs. The need for individual management of producers is further complicating this. The Israel Electric Corporation operates units that are fully available to the system operator and are required to participate in reserve maintenance and provide AS. The operation of these units is based on techno-economic parameters, fuel costs, variable operation and maintenance costs, and start-up costs, with payments made based on actual expenses.
Private conventional producers with variable availability are required to generate energy for their consumers during peak hours, with the option to purchase energy at time-of-use tariffs during off-peak hours. These producers submit bids for surplus energy and are compensated through a “Pay As Bid” method, with bid prices regulated by price caps. They do not participate in reserve maintenance or AS except as mandated by their licenses. Private conventional producers with fixed and variable availability must participate in reserve maintenance and provide AS. The system operator manages these units based on techno-economic parameters defined in their licenses. Additionally, a small portion of these units operate under the principles of variable availability.
Private power plants operating under the NOGA tender follow a model like the variable availability system, requiring continuous energy generation for their consumers while offering surplus capacity based on incremental production costs. Participation in reserve maintenance and AS is limited to licensing conditions. Private conventional producers with fixed availability are required to maintain reserves and provide AS. Their bids reflect normative production costs recognised in their licenses and are compensated according to their submitted costs.
Following the acquisition of generation units from the IEC as part of the electricity market reform, producers operating under generic standards for fixed availability must also participate in reserve maintenance and provide AS. Their bids are not regulated by price caps and are compensated based on market prices. An “Uplift Payment” mechanism ensures a minimum daily income if market prices do not cover their operating expenses. Co-generation producers use the heat generated during electricity production for other non-electricity processes, achieving high efficiency. These producers are allowed to self-load according to their needs and can inject energy into the grid at a predetermined tariff. They generally operate under a stable “Must Run” regime and do not participate in reserve maintenance or AS, except as required by their licenses [84].
The regulatory framework in Israel limits the utilisation of RES- and StSy-based ASs. A high-voltage storage tender will enable the system operator to utilise the facilities for frequency regulation, as it determines their loading method. Israel relies on a centralised dispatch model lacking market-based mechanisms and clear compensation for RESs and storage providers needed to promote competition and innovation. This causes RESs and StSys to be excluded from AS provision and from dynamic and competitive markets. Furthermore, proper standards and certification processes are missing to enable RESs and StSys to provide real-time grid support. The physical grid is susceptible to bottlenecks high-density RESs in peripheral regions limit the development and promotion of RES deployment and AS provision.

4.1.2. California

Regulatory Framework and Responsibilities

AS in the CAISO grid includes up- and down-regulation, spinning reserve, non-spinning reserve, and voltage control. These services comply with North American Electric Reliability Corporation (NERC) and Western Electricity Coordinating Council (WECC) standards. CAISO is responsible for ensuring the availability of these services. This includes internal and external procurement and can be self-provided by scheduling coordinators and competitive procurement.
These AS must meet strict standards to ensure grid reliability. These standards are being set via historical and forecasted operational conditions, as well as disturbances to the entire system and demand conditions. Therefore, ASs could be procured cost-effectively, ensuring that reliability requirements are met. Each of the ASs is being set with the required standards. These standards are regularly reviewed and adjusted based on current needs and conditions, constraints, and regulatory requirements [92].

Ancillary Services Types and Grid Requirements

CAISO uses a regional system to procure ASs. This means different areas within the CAISO’s grid must provide ASs to the system. Consequently, the quantity and location of each of the ASs throughout the regions. AS Regions are network partitions within the grid designed to manage the procurement of ASs corresponding with the physical limitations of the transmission system. These regions consist of specific sets of pricing nodes (PNodes). Their procurement is controlled by lower and upper limits to ensure that services procured in one region do not impact other regions’ operational integrity. Part of this approach is the inclusion of stakeholder input and parties wishing to participate, as well as compliance with the Federal Energy Regulatory Commission (FERC) [93].

Procurement Methodology and Market Design

CAISO procures its AS based on day-ahead demand forecasts. Within this market, necessary service availability can be ensured to meet the forecasted demand and maintain system stability.
Each AS type has specific required quantities and locations to ensure grid reliability. These services must be under CAISO’s real-time control to allow dynamic adjustments based on grid conditions. ASs can be substituted for another if found to reduce costs, better maintain grid reliability, optimise resource use, and minimise end-user costs.
AS procured by CAISO is achieved using competitive day-ahead and real-time markets. Eligible participating loads and systems for providing ASs must be certified while demonstrating compliance with the technical requirements.
The amount of ASs procured in the integrated forward market (IFM) is adjusted to address any need and requirement of the grid and market. The ASs procured from the day-ahead and real-time markets are mainly operational and fast-reaction reserves, such as 15-min markets. Additional procurement from real-time markets can be carried out as per transmission constraints and availability in the day-ahead markets. In any case, any system wishing to participate as an AS provider must be certified. Each AS has its own set of requirements, including controllability, availability, and overall capacity.
Participating systems must be capable of being controlled by an energy management system (EMS) and respond to control signals without being manually intervened while meeting the technical requirements.
Spinning and non-spinning reserve procurement is achieved from internal resources within the balancing authority area and external resources if they can be dynamically scheduled and meet the technical requirements. These requirements mean that any deviations, including outages and power provision issues, could also adjust the AS. Regulation up and down, spinning reserves, and non-spinning reserves are being procured daily and in real-time through IFM and real-time market (RTM). Voltage services are additionally procured at various periods when deemed economically advantageous. In addition, voltage support is provisioned using a merit-order stack that considers the least-cost resources, ensuring reliable voltage services.
Public utilities are subjected to a specific cost-based mechanism, ensuring fair compensation while maintaining consistency in pricing structures set by the Federal Energy Regulatory Commission (FERC). All other participants use market-based rates to ensure a competitive market [92].

Eligibility, Certification, and Prequalification of Service Providers

CAISO allows bids to be submitted from internal and external AS sources. These ASs can be offered simultaneously for multiple service types within the same market and can be submitted up to seven days in advance.
Before participating in the CAISO markets, each system must be certified by CAISO, confirming its compliance with its technical standards for providing ASs.
Scheduling Coordinators are responsible for attaining certification for their systems, which involves compliance with the requirements set in the CAISO for the tariff and the business practice manuals (BPMs). The systems eligible may be inspected periodically to ensure their compatibility with the requirements of CAISO. If the certification fails to meet the requirements, it may be revoked. Each system offering ASs must have specific operating characteristics tailored to their service type. Those systems must also be able to be automatically regulated without manual intervention. Systems offering regulation services must be able to respond to the control signals from CAISO’s EMS in real-time, which are used for adjustments according to the grid’s needs, such as increasing or decreasing output in MW per minute. Systems providing spinning and non-spinning reserves must be capable of responding quickly to grid contingencies.
Systems providing regulation services must be continuously dispatchable for a certain amount of time after receiving a dispatch instruction.
Apart from controlling, the systems must be capable of acting on dispatch instructions within 10 min, providing their capacity for at least 30 min to maintain the grid’s reliability during contingencies. In addition, all participating systems must be equipped with secure communication paths to receive and implement dispatch instructions from CAISO. Regulation services are required to have direct digital control links.
Furthermore, the metering infrastructure of participating systems must meet specific CAISO requirements, including the type and location of meters and their capabilities related to automatic control responses.
CAISO conducts periodic unannounced tests to verify the availability and performance of resources providing ASs. These tests include compliance testing for regulation, spinning reserve, and non-spinning reserve capabilities. Resources failing to meet performance standards may face suspension of their technical eligibility certificate and other penalties designed to ensure reliability and discourage non-performance [92].

Technical Standards for Ancillary Services Providers

Participants aiming at regulation services must have a minimum rated capacity of 500 kW. Storage resources can qualify for 100 kW. In either case, these systems must reach their maximum regulation capacity within 10 min after receiving a dispatch instruction and adjust their real power output immediately upon receiving control signals from the EMS. In addition, they must be continuously dispatchable for at least 60 min in the day-ahead market (DAM) and 30 min in the RTM. Furthermore, they must have a measured response accuracy of at least 25% to EMS signals as a requirement.
Spinning and non-spinning reserve services participating systems have the same threshold requirement as regulating systems. Spinning reserve systems with controllers must automatically respond to frequency deviations with specified settings, including a 5% droop (or 4% for combustion turbines) and a +/−0.036 Hz deadband. Power output changes must occur within one second for any frequency deviation outside the deadband. These systems must be capable of receiving dispatch instructions within a minute to reach their maximum regulation capacity within 10 min and adjust their actual power output immediately upon receiving control signals from the EMS.
The non-spinning reserve services provide additional backup capacity and need to be capable of being brought online quickly in case of a sudden demand increase or generation shortfall. Like the spinning reserve systems, non-spinning must be capable of receiving dispatch instructions within one minute, reaching the wanted power level within 10 min after receiving a dispatch instruction, and maintaining this output for 30 min.
The participating systems must meet specific performance standards for the control signal process of the EMS while continuously monitoring the transmission data.
Economic procurement of AS involves market mechanisms and tariffs set by CAISO to ensure competitive and fair competition and compensation for service providers. Incentives are structured to encourage participation from all types of systems and resources, including generation units and storage technologies.
Participating systems providing ASs in both DAM and RTM. Remuneration mechanisms are designed to correspond with flexibility values and reliability provided by the AS. The remuneration of participating parties is based on their availability, performance, and compliance with dispatch signals availability. Storage units and aggregated systems are incentivised with lower capacity thresholds and higher flexibility, leading to easier integration of more RESs and enhancing grid resilience. The financial obligations and performance standards for ancillary service providers are crucial for adequate compensation while maintaining grid integrity and reliability [94].

Reserve Activation, Dispatch, and Congestion Management

CAISO is using ancillary service regions with specific groups of PNodes managed via lower and upper limits to balance the availabilities within the operational limitations of the grid. This is essential for managing the procurement and distribution of ASs across the grid.
AS requirements are set in accordance with certain standards ensuring the grid’s operational viability, including reserves, under various conditions.
Spinning reserve involves systems being online and ready to increase their output immediately in response to disruptions in supply. These resources are typically kept at partial load, ensuring they can quickly be ramped up if needed. Non-spinning reserve systems are kept offline but can be utilised within 10 min to provide additional capacity during emergencies.
Procurement limits for AS are used to ensure sufficient reserves and capacities, which are calculated based on various factors such as load levels, generation capacity, and contingencies, ensuring the supply system can withstand supply interruptions.
Market participants can provide self-provided AS using their own resources if they meet the requirements. Certified participants may submit bids to self-provide these services in the IFM.
If needed, CAISO may redirect resources from AS to energy production to maintain the grid’s stability. Resources meant for energy production can also be used to become AS if needed. In addition, CAISO is operating a cascading procurement, in which AS deemed of “higher quality”, such as regulations, can be used as spinning reserve AS if it is economically appropriate. In cases of sudden losses of generation or transmission, manual real-time contracts can be utilised. Prices for procuring ASs are marginal and determined based on the costs of providing the services at specific locations within the grid. The prices are calculated per PNode. In addition, the AS market can be managed via a so-called “Contingency Only” mechanism, to which all spinning and non-spinning reserves are automatically classified in the RTM.
Procurement of ASs occurs in both the DAM and RTM. In the DAM, ASs are being secured based on forecasted needs, allowing risk mitigations associated with real-time demand fluctuations. In the RTM, procurement is being adjusted based on actual grid conditions, aiming at dynamic responses to any variations between forecasted and real-time demand [93].
The total energy generation in California was 281 TWh in 2023, whereas the share of each energy source in the energy mix is illustrated in Figure 3:
The installed storage capacity can be seen in Figure 4:
Table 1 illustrates the current AS provision and procurement in California, US.

4.1.3. Germany

Regulatory Framework and Responsibilities

The German power grid and all the actors involved must work under both European and national regulatory systems. In terms of responsibilities, the main legal framework on the national level is defined in the Energy Industry Act (EnWG). The EnWG dictates the obligations and the regulations for ensuring secure and reliable system operation, and it regulates the market-based procurement of non-frequency-related ASs by TSOs and DSOs. The TSOs are responsible for maintaining the system’s operability within their jurisdiction areas, including balancing power in case of deviations, maintaining the voltage within the proper limits, and managing the load on operational resources within the balancing group (BG) and area. Management of the BG is a market-related function. It requires the grid operator to balance actual consumption with forecasted consumption. The measures are implemented in a cascading manner across all grid levels, starting with the transmission grid. This act specifies the priority of grid-related measures over market-related measures to ensure system integrity and operability, meaning that physical corrections will be addressed before market adjustments. Market-related measures include energy balancing, activation of switchable loads, congestion management, and deployment of additional reserves. Grid-related measures involve mainly grid switching. TSOs must manage any grid constraints and maintain system stability through ASs, such as voltage control, frequency regulation, and system restoration after outages. The TSOs must maintain reserves to manage grid constraints and balance supply and demand during disturbances. The regulatory authorities are granted powers to establish capacity reserves, implement ASs, and promote the integration of RESs into the grid while maintaining stability. Distribution system operators (DSOs) manage the distribution grid and support TSOs. DSOs are authorised to implement grid-oriented regulation of controllable loads and connections to manage grid constraints and enhance system stability, corresponding with the specifications set by the Federal Network Agency (Bundesnetzagentur), as well as implement contractual load-shedding agreements to manage demand during peak times or necessities. They must procure flexibility services through transparent, non-discriminatory, and market-based procedures to enhance grid efficiency and integrate demand response, distributed generation management, and energy storage. The DSOs are obligated to develop the grid and expansion plans, allowing the integration of new emerging technologies and RESs. In addition, the regulator requires a common internet platform to allow transparency and information sharing between DSOs, TSOs, and market participants to improve coordination and system efficiency [50].
In addition, Germany is subject to the rules and regulations of the EU and must comply with its directives and regulations in addition to national regulations. The EU Commission regulates the procurement and provision of ASs within the European energy market [65]. This directive outlines the requirements for transparency, non-discrimination, market efficiency, and technical and economic principles. The DSOs are required to adopt rules for procuring necessary products and services, ensuring the effective participation of all qualified market participants. The TSOs procure balancing services and non-frequency AS through transparent, non-discriminatory, and market-based actions. The internal market for electricity in Europe ensures efficient market operation, including market integration and improved price signals. This market focuses on promoting RESs, creating capacity mechanisms, implementing regional cooperation frameworks, and facilitating demand response initiatives. The regulatory framework explores ways to foster competition and innovation in the electricity market [66].

Ancillary Services Types and Grid Requirements

Currently, ASs are provided by both conventional and renewable energy power plants. In the German AS market, the ASs are categorised into several areas, namely (i) frequency control (including primary, secondary, and tertiary control reserves), (ii) voltage and reactive power control, (iii) services for congestion management (including redispatch measures), and (iv) black start. The procurement of ASs in Germany is conducted through a competitive and regulated auction-based system. These auctions are held regularly to procure services such as frequency response: (i) primary response is procured via pan-European auctions, whereas providers are being remunerated using fixed payments for maintaining reserve capacity and variable payments when the reserves are activated, (ii) secondary response is procured at the national level but harmonised across Europe, and (iii) tertiary is also procured through national tenders.
The remuneration system for ASs ensures that providers are properly compensated for their participation. Primary and secondary reserves are compensated via a combination of fixed payments for maintaining reserve capacity and variable payments for actual reserve activation. The remunerations are influenced by market volatility and operational costs. Power plants participating in redispatch are compensated for their costs, including opportunity costs from adjusting their production schedules and the direct costs incurred, such as fuel expenditures.
The individual configuration of ASs in Germany reflects the specific needs of its energy grid. The grid is characterised by its increasing reliance on renewables and cross-border electricity flows, requiring advanced grid management techniques. The market-based procurement of AS ensures transparency and competition among service providers. Regular auctions are held, with technical specifications and response times clearly defined by the TSOs. Providers must meet these stringent criteria to qualify for participation, ensuring that the grid can respond swiftly to fluctuations [95].

Procurement Methodology and Market Design

Frequency AS (F-AS) procurement processes are governed by the regulation on the German Electricity Feed-In Regulation (StromNZV), which mandates that TSOs issue public and anonymised tenders to acquire the necessary balancing services. Procurement of frequency services takes place in the German Electricity Balancing Market, which is divided into (i) primary (FCR), (ii) secondary (a/mFRR), and (iii) tertiary (RR) reserves. This is regulated in the German Electricity Network Access Ordinance (StromNZV), in which TSOs are assigned to issue tenders to acquire necessary services. Each of the reserves is separately tendered. The TSOs are legally required to procure balancing services via transparent auction processes using a designated centralised platform. All bids are anonymised to ensure fairness and avoid discrimination and are being issued jointly to all the TSOs in Germany to prevent imbalances.
Primary tenders occur weekly and require the symmetric provision of positive and negative balancing power, whereas tenders for secondary and tertiary services occur daily, traded in six blocks of four hours each. Unlike the DAM and intraday market, the balancing market includes the capacity price (in EUR/MW) paid to providers for the availability of reserve power, and the energy price (in EUR/MWh) is paid when the energy is utilised.
FCR services are compensated only by the capacity price. Bids in the m/aFRR and RR markets are ranked based on a mix of capacity and energy components. The total price for each bid is calculated by adding the capacity price and a weighted energy price. This is then used to determine the order in which bids are accepted, with the lowest composite prices being selected first. The procurement process operates on a two-stage merit-order auction basis. Initially, bids are sorted by capacity price, with the lowest prices accepted first until the demand for balancing power is met. Energy prices are used to determine which plants are dispatched when reserves are needed. However, unlike the DAM, the balancing market operates on a “pay-as-bid” model, meaning that providers are paid their actual bid price rather than a uniform market-clearing price [96].

Eligibility, Certification, and Prequalification of Service Providers

The regulatory framework mandates public and competitive procurement but also describes the technical prequalification requirements for generators. Only reliable and technically capable plants can participate. The prequalification is detailed in the German TransmissionCode. In addition, the German Electricity Network Access Ordinance (StromNZV) requires that costs incurred by the TSOs for balancing services procurement be passed on to the end users to apportion the costs to all market participants. The minimum bid sizes lead to only larger, more reliable providers typically participating in these markets. However, the market allows for pooling, using multiple smaller plants that can combine their capacities to meet the minimum bid requirements. Via this structure, the TSOs have better control over the balancing services for maintaining the grid frequency and stability. Market-based auctions allow transparency and a more cost-efficient system while keeping sufficient reserves available [96].
In the non-frequency AS (NF-AS), the TSOs determine and procure ASs for both long-term and short-term needs. The procurement varies depending on the grid level and the specific services needed. The transmission grid is being constantly monitored following the national grid development plans. Procurement of services like reactive power and black start is typically achieved via bilateral contracts. The provision, maintenance, and dispatch conditions of NF-ASs are stated in these agreements and are often integrated into grid connection contracts [65].

Technical Standards for Ancillary Service Providers

NF-AS are primarily acquired per demand when new grid connections are made or grid conditions change. Reactive power procurement is ad-hoc, and providers are compensated for maintaining availability and delivering energy when needed. This service is part of the regular transmission grid operational timeframe planning, such as remuneration for reactive power in the transmission network, and the procurement of reactive power includes compensation via reactive energy price (i.e., the fee charged for actual consumption or provision of reactive power) for the energy delivered. This service is, however, usually not remunerated in the distribution network.
Black start services used for grid restorations typically have an embedded annual capacity payment for availability, with additional energy payments if the service is utilised following a blackout. Similar to F-AS, NF-AS must be procured via a transparent, non-discriminatory, market-based system unless inefficiencies dictate otherwise, as mandated by the EU directive on common rules for the internal electricity market [65]. In case NF-ASs cannot be provided by fully integrated grid components, a market-based procurement may be utilised.
Procurement processes vary at the grid level. Opposed to the transmission system that is being monitored, as mentioned above, the distribution grids, i.e., medium voltage (MV) and LV levels, have more limited data availability, complicating the procurements [97].
As mentioned, the services for congestion management are fairly based on flexibility. Flexibility is acquired in market mechanisms like day-ahead and intraday auctions and through measures such as redispatch and curtailment. The day-ahead auction sets hourly prices based on bids for the following day. The intraday market allows real-time adjustments to forecast deviations. The intraday auction offers quarter-hourly products for more precise balancing, and continuous trading enables market participants to adjust their positions up to 30 min before delivery. This market-based procurement is essential for integrating renewable energy and managing the fluctuations caused by intermittent sources like wind and solar.
Flexibility for grid congestion is primarily procured via redispatch and curtailment. TSOs employ grid-related measures, such as switch-on/off if transmission congestions occur. If congestions continue, redispatch measures will be initiated. This is supported by grid reserve capacity, determined annually through system analysis. If the redispatch measures are still insufficient, the TSOs can execute feed-in management measures to adjust generation and consumption by curtailing renewable energy and other flexible assets. The costs of redispatch, curtailment, and grid reserve capacity are passed onto the consumers via grid fees [98].

Reserve Activation, Dispatch, and Congestion Management

Redispatch and curtailment are compensated as per the actual energy reduced or shifted. This depends on the connection agreements and feed-in tariffs. For RESs, the compensation rates are described per system type and year of commissioning in the German Renewable Energy Act (EEG) [99]. Grid reserve capacity is stipulated in contracts between the TSOs and system operators via competitive bidding and covering costs for maintaining, operating, and utilising. Operators are compensated for availability and consumption. However, they are forbidden from selling this capacity at electricity markets [50].
The total energy generation in Germany was 2845 TWh in 2023, whereas the share of each of the energy sources in the energy mix is illustrated in Figure 5.
The installed storage capacity can be seen in Figure 6:
Table 2 illustrates the current AS provision and procurement in Germany.

4.2. Insights and Findings from Interviews with Experts

According to the interviews, RESs and StSys will play a vital role in providing ASs as the energy system transitions toward a more sustainable, green, and efficient energy supply chain.

4.2.1. Strategic Importance, Challenges, and Feasibility

The interviews dealt with feasibility, strategic importance, and challenges involving the integration of storage and RES-based ASs into the power grid operation. The respondents included experts in the Israeli energy field with substantial relevant experience covering technological, economic, and regulatory aspects, as well as academic persons. The interviewees provided insights into how the energy sector operates and evolves, and where and how it could be improved. The responses provided insights as a combination of practical and theoretical knowledge, considering the different types of energy sources, including RESs, conventional energy sources, and general power generation and the relevant markets. Further, energy security and the importance of resilient infrastructure were discussed, alongside the government’s involvement in ensuring regulatory frameworks and policies supporting the necessary infrastructure and market conditions while allowing further development within acceptable boundaries. The interviews with experts in Israel’s energy sector reveal the significant challenges in incorporating RES and energy StSy into the country’s electricity grid.

4.2.2. AS Role in Ensuring Stability and Reliability

ASs, such as frequency balancing and voltage control, are essential for system stability. As the grid incorporates more intermittent, variable RESs, like solar and wind power, the RES-based AS role becomes increasingly critical. The reliability of these services ensures that fluctuations in energy production will not lead to imbalances in the grid or even outages while maintaining a consistent energy supply. ASs are crucial in managing the variability. Storage allows excess energy to be stored and used at later times of deficits. This is crucial for maintaining grid stability and reliability, making RESs viable and reliable contributors to the overall energy mix.

4.2.3. Evolution of AS Provision

Historically, ASs were provided by the SOs and public utilities. However, there is a growing trend towards privatising and decentralising these services. This transition improves competitiveness as private entities bring new technologies and efficiencies to the market. Privatisation also enables a better distribution of ASs across the entire energy system, particularly in the peripheral regions where energy imbalances are more common. This can be translated into local utilisation of the ASs.

4.2.4. Regulatory Frameworks, Pricing Mechanisms, and R&D

To successfully deploy AS, the regulatory frameworks must establish clear guidelines and pricing mechanisms to ensure the services are economically viable and profitable for AS providers. The legislators are central in fostering a competitive and sustainable energy market. Regulation is the key component influencing the profitability and competitiveness of RES and storage owners as they strive to be more innovative and improve their efficiency and profitability. Providing reliable and cost-effective AS will be a key differentiator in the market. Companies that can effectively manage energy storage and provide essential grid services will be better positioned to thrive in a competitive landscape.
Ongoing research and development initiatives are essential for advancing the capabilities and integration of AS. Yet, there is a need for more focused research and pilot projects to explore the full potential and impact of RES-based AS while helping identify best practices and develop scalable solutions.

4.2.5. Employment and Education Opportunities

RESs and storage facility integration encompass employment opportunities, particularly in construction, IT, and specialised technical fields, emphasising the need for organised educational and training programs. These programs ought to focus on both technical and regulatory aspects of electricity trading, energy management, and AS to ensure a skilled workforce supporting the expansion of RESs.

4.2.6. Energy Security, Resilience, and Regional Characteristics

By establishing energy unions and constructing renewable energy and storage facilities, local entities can contribute to energy security and resilience. In addition, community and stakeholder participation is critical for the successful deployment of DRES, as acceptance of new technologies and infrastructure can be easily achieved, while stakeholders can provide valuable insights, supporting regulatory compliance.
To successfully integrate RES-based AsS, some areas should be in focus for further research and innovation, such as dual-use PV systems, agrivoltaics, and long-duration storage solutions (including hydrogen storage). These aspects can address the intermittency and variability of RESs. Developing a resilient grid infrastructure is also essential to withstand and quickly recover from disruptions.
Variability mitigation is an important aspect that can be achieved by employing storage strategies and technologies. Onshore natural gas storage, large-scale battery farms, and hydrogen storage can provide important backup services, enhancing grid resilience and allowing the grid to manage generation-consumption fluctuations. By providing reliable and flexible energy storage, these technologies support the transition to a more renewable-based energy system, ensuring a reliable and continuous energy supply.
The regional characteristics of energy production and demand fundamentally impact the integration of RESs. For instance, the concentration of renewable-based generation in peripheral areas and the lack of proper grid infrastructure can cause imbalances. Storage solutions are essential for balancing in these regions. This temporal mismatch between solar energy production and peak demand stresses the importance of storage facilities, as these facilities can store the excess energy generated by, e.g., PVs and discharge it during peak hours.

4.2.7. AS Provision, Necessities, and Limitations

AS are essential for maintaining grid stability. Traditionally, ASs are provided by conventional power plants, primarily natural gas-fired plants. Those services, including frequency regulation, voltage control, and spinning reserves, are crucial for ensuring the reliable operability of the grid. However, with increasing RES penetration, such as solar and wind, the evolving energy landscape needs to be modified regarding how ASs are provided and regulated.
Currently, ASs are administered by regulations designed for conventional energy sources, particularly those able to provide dispatchable power, with a current focus on gas turbines capable of responding quickly to fluctuations and stabilising the grid. The intermittent nature of RESs complicates their participation in providing ASs under the regulatory framework. As guidelines for allowing RESs and StSys to offer grid-supporting services, e.g., frequency control, regulatory reform is needed to accommodate RESs and StSys within an AS market. StSys are capable of providing fast response services, such as those to support frequency and voltage, helping balance the grid. However, due to a lack of compensation mechanisms, StSys are still underutilised. The regulatory bodies, including the IEA, must develop new policies to support the integration of RESs and storage technologies, including clear guidelines for compensating ASs provided by those systems.
Currently, ASs are typically obtained through long-term contracts with conventional power plants. This way, the grid will have access to reliable and dispatchable power. However, this also limits the use of RESs to participate in the market. Solar and wind power, in this sense, have difficulties competing with conventional systems under the current procurement structure.
Modifying the procurement process to allow competitive bidding is crucial for improving and optimising the Israeli energy system. This would lead to more participants offering AS, resulting in lower costs and promoting innovation. In addition, opening up the market can directly increase the ability to leverage flexibility and help integrate more renewable energy into the grid. Furthermore, competitive procurement could incentivise the development of new technologies that enhance grid resilience and stability, ultimately benefiting both energy providers and consumers.

4.2.8. Grid Infrastructure and Dependency on Conventional Resources

Israel’s energy grid relies heavily on natural gas for both electricity generation and AS. Although RES capacity, particularly solar power, has been increased, the grid’s infrastructure is still inadequate for fostering this capacity. The grid was initially designed for centralised, dispatchable energy sources, which can be controlled to meet demand, and the variable nature of RESs poses challenges to the grid’s stability. StSys are crucial for solving this problem, as they store excess energy. However, deployment is still in its early stages, with only a few pilot projects demonstrating their potential. Though valuable, these projects are yet to be sufficient to provide large-scale support to fully integrate RESs into the grid and require a significant investment to expand the deployment of storage solutions.
The transmission infrastructure is underdeveloped, which is a significant bottleneck. The RES installed capacity is found mostly in peripheral regions, and the transmission lines are inadequate for transporting energy to the population’s central areas. This directly affects the amount of RESs that can be fed into the grid.

5. Discussion

The integration of RES-based and storage-based ASs into the Israeli electricity grid must be accompanied by a regulatory transformation capable of fostering frequency regulation, voltage control, and congestion management in line with the abilities of the resources. The regulatory frameworks in Germany and California provide insights into the potential implementation of Israel’s plan for a more robust and efficient power system, allowing AS provision from RESs and StSys.
Frequency regulation in Israel relies mainly on gas turbines and spinning reserves. Though able to provide quick responses, they are also cost-intensive and are more emitting. This structure is not suitable for VRE. Germany has introduced a multi-level (primary, secondary, and tertiary regulations) procurement approach regulated in transparent, competitive markets. The markets will differentiate services based on response speed and duration. Participants are compensated by two compensation streams, namely (i) capacity payments and (ii) activation payments. Capacity payments will ensure that RES and StSy owners maintain the capacity availability required for frequency fluctuations. Activation payments will compensate for the actual power provided when adjustments are needed. This payment scheme will incentivise RES and StSy owners to be available to support the grid. Performance standards must be set for implementing such a scheme, emulating the requirements defined in Germany to guarantee proper responses within the appropriate timeframes. Certification standards must be created, including periodic, unannounced testing. This will verify that RESs and StSys can adjust power in real-time, maintaining response capabilities in varying grid conditions. Creating a well-structured AS market for frequency regulations will lead to benefits, as this will be a more sustainable model.
The German and California cases utilised approaches involving dual-compensation mechanisms and locational pricing, promoting the participation of RESs and StSys for providing grid-supporting services, thus providing models for incentivising resource availability and location-based provision, especially applicable for congestion-prone areas. Similar practices in Israel could directly contribute to grid operation improvements by promoting real-time adjustments, decentralised and localised procurement, and supporting the penetration of higher RESs and StSys.
Currently, regulations in Israel for voltage control are only technical and require PVs connected to a high-voltage grid to keep specific ride-through capabilities to avoid disconnections from the grid. Those systems are expected to adjust reactive power when needed autonomously. However, this model does not aim at a dynamic, market-driven framework enabling RESs and StSys to provide real-time voltage support.
The regulations in Germany mandate reactive power compensation as part of the voltage control. In addition, TSOs and DSOs procure voltage services on different levels transparently and non-discriminately. This allows voltage regulation utilisation in specific areas with higher RESs while ensuring localised voltage support. As an ISO, regional procurement zones were established in California to address this issue while relying on competitive bidding and resource stacking, ensuring a cost-effective process and incentivising local resources to be allocated appropriately.
In Israel, RES systems, especially PVs, should be mandatorily equipped with advanced inverters capable of responding autonomously and automatically to frequency deviations in real time. This can enable the utilisation of RESs and StSys for frequency regulations. Market-based procurement schemes are recommended to be developed similarly to frequency regulations, i.e., capacity and performance-based. Voltage regulation zones, especially for areas with high-RES density, should also be advised, as it will promote local procurement and allow the SO to source voltage support directly in the intended location. This approach will decentralise voltage control services and promote RES and StSy’s economic viability.
Congestion management in Israel currently relies on a centralised dispatch system. The SO publishes a general loading program designed to coordinate all generators connected to the grid on a designated website for the following day. This program includes detailed forecasting and expected generation capacity. The systems are either self-loading, operating autonomously as per predefined agreements, or centrally loading, managed directly by the SO with real-time adjustments.
This model, however, does not facilitate the market-based participation of RESs and StSys. These are managed by operational directives set in a general loading program without being compensated for dynamic congestion services.
In Germany, congestion management is handled with redispatch mechanisms. The TSOs are authorised to direct generation to adjust power based on real-time data. This is being compensated for operational and opportunity costs. In California, the locational marginal pricing (LMP) system encourages RES and StSy to provide services in grid areas with frequent congestion. This functions as an economic driver for congestion relief, ensuring market efficiency via competitive day-ahead and real-time procurement. Congestion zones could be established in Israel, promoting RESs and StSys as providers of services for congestion. By introducing an LMP system, variable pricing in those zones can be utilised, incentivising RES and StSy installations in needed locations. In addition, SOs should be authorised to instruct RESs and StSys in these zones to adjust power when required. Remunerations must be transparent, fair, and based on contribution and scale of involvement.
Furthermore, a regulatory framework for StSys and RESs allowing them to operate below 100% output should be created, providing SO flexibility to adjust power in those systems and address deviations as needed. Owners will be compensated with capacity payments for reserve availability and activation payments for actual adjustments. This may be anchored via contracts specifying minimum thresholds for the SO to increase or decrease power dynamically, with penalties when not meeting the required response time and energy amount. In addition, a real-time platform for monitoring and bidding should be established, allowing a transparent remuneration scheme based on performance.
The services and markets, as well as the relevancy and implementation potentials, can be seen in Table 3. The Table illustrates the insights gathered regarding regulatory frameworks and market mechanisms and their applicability in Israel.
The table illustrates the comparison and implementation potentials of ASs and additional aspects needed to promote REs and StSys as AS providers and their further penetration to the grid, while showing how the different aspects address specific challenges in Israel. It offers valuable insights into modernisation plans and approach possibilities. As RESs in Israel are expected to increase to meet the national goals, each of the aspects addresses specific needs as they become more critical for a continuous, safe and reliable grid operation in the country. The ease of implementation varies based on the current regulatory framework and physical infrastructure.
Deploying the AS and the other measures mentioned in the table will enable Israel to manage the transition towards RE-oriented grid operations.
The ease of implementation reflects the effort needed to be able to adapt to the different aspects.
The heavy reliance on gas turbines calls for a transition towards market-based and real-time procurement, which requires some regulatory modifications and market infrastructure. Deploying voltage regulation zones in RES-dense areas is feasible, but regulatory reforms and compensation mechanisms must be established. To properly be able to tackle issues leading to the need for the black start, proper StSy infrastructure with the ability to provide this service must be heavily invested in. LMP implementation must have a fair compensation scheme and must be able to dynamically respond when needed, which requires innovative market mechanisms and regulatory changes. Pay-as-bid and dual-compensation systems can be easily deployed. Real-time grid control is achievable but requires thorough planning and investments as well as regulatory modifications. Flexibility measures are relatively uncomplicated to implement, and they will be directly used for grid stabilisation and for promoting RES integration.
Adopting lessons from Germany and California will require addressing each aspect differently based on their maturity and existing situation.
The dual-compensation model in Germany and the LMP in California offer incentives for RES and StSy participation as part of the AS market systems. The grid constraints and the market’s maturity in Israel call for gradual implementation, with basic market mechanisms and pilot testing of solutions for specific elements, such as redispatch and regional procurement schemes. Currently, the regulations in Israel lack dynamic and market-driven mechanisms but can benefit from adopting competitive bidding and capacity-activation compensation schemes, as they can contribute to the establishment of clear, transparent, and fair remuneration methods, resulting in encouraging the promotion of RES- and StSy-based ASs. Germany and California’s AS market mechanisms and systems could potentially improve the entire power supply chain. However, for this to occur, reforms and infrastructure upgrades must take place.

6. Conclusions

When combined with StSys, RESs can effectively provide ASs traditionally offered by conventional generation units. However, their integration into the power system in Israel faces challenges, as a centralised dispatch model, underdeveloped grid infrastructure, limited market mechanisms, and a lack of clear compensation structures for RESs and storage providers currently characterise the system.
These limitations are especially critical in peripheral regions with high renewable generation, where congestion and grid congestion already exist. These barriers can be overcome via regulatory, market, and technological refinements.
These limitations can be addressed by decentralisation and localisation of AS procurement while aligning the market signals with operational needs in areas with high RE density. Deploying designated regulation zones for voltage and congestion can aid the SO in allocating resources more efficiently.
The Germany and California cases show that adopting international best practices and standards can promote RES and StSy’s effective deployment for grid support services. Market-based AS procurement schemes could enable more competitive and efficient resource allocation. In addition, capacity and activation-based compensation models could be essential to encourage participation and ensure economic viability. Furthermore, certification processes and performance monitoring systems must be developed and regularly verified to guarantee the quality and reliability of these services.
Decentralisation and localisation of AS procurement can enhance grid operation, stability and reliability, especially in areas with high-RES density. This measure can align market signals with operational requirements.
By implementing regulatory reforms, adopting market-based incentives, and advancing enabling technologies, Israel can efficiently utilise RESs and StSys. This transformation could contribute to national decarbonisation goals, enhance system reliability, and support long-term energy independence.

7. Research Limitations and Recommendations for Future Research

Regarding RESs and StSys providing ASs, the Israeli energy market is still in its early stages. The ability to conduct in-depth interviews was restricted due to the limited availability of practical experience and data. Though valuable, the insights from the interviews depict the nascent stage of the market and the need for further development in the sector.
However, this study is limited by the small sample size (n = 13), introducing a potential bias and limiting the generalizability of the findings. In addition, the absence of real-world pilot data restricts the ability to validate the recommendations empirically.
This study focuses primarily on the technical and regulatory aspects of integrating RESs and StSys into AS provision in Israel. Economic aspects of AS procurement, including cost-benefit analyses and evaluations of market efficiency measures, are beyond the scope of this thesis. However, further examination of these issues could offer a deeper understanding of the trade-offs and implications involved in regulatory and investment decision-making processes. Additionally, quantitative analysis investigating cost savings and grid improvement modelling could be beneficial for data-driven justifications and policy and regulation adjustments.
Additionally, though being crucial aspects for shaping effective and competitive AS markets, dual-payment models or the profitability impacts of different market design mechanisms such as pay-as-bid versus marginal pricing examinations, require further techno-economic studies, given the nascent of ASs in Israel and the lack of usable, applicable data, and thus fall beyond the scope of this research.
Moreover, while the study addresses technical challenges and regulatory mechanisms, socio-political factors influencing the adoption of ASs, particularly in Israel, which has less mature energy markets, were not included. Though important, these aspects need further investigation in future research.
Future research may focus on quantifying cost-benefit trade-offs, developing robust performance metrics, exploring long-duration storage technologies, and examining the implications for energy justice. As RES penetration increases and conventional generation recedes, the successful integration of distributed, renewable-based ASs will be essential to securing Israel’s clean, reliable, and equitable energy future.
As Israel’s energy market evolves, the integration of RESs and StSys into AS provision will see an increased need for more concrete data collection, real-world testing and refining, and regulatory adjustments. Further research to expand on the technical, economic and societal opportunities of RES- and StSy-based ASs, using this study as groundwork, could show the potential and benefits of deploying such measures as well as promote the development of a more sustainable, efficient, equitable and reliable energy system. Such efforts could contribute to developing a sustainable, efficient, equitable, and reliable electricity system in Israel.

Author Contributions

Conceptualization, E.L. and O.A.; Methodology, E.L. and O.A.; Formal Analysis, E.L.; Investigation, E.L.; Resources, E.L.; Data Curation, E.L.; Writing—Original Draft Preparation, E.L. and O.A.; Writing—Review and Editing, O.A.; Supervision, O.A.; Project Administration, O.A. All authors have read and agreed to the published version of the manuscript.

Funding

This research received no external funding. However, the main Author, E. Littwitz, has received general scholarships for his studies.

Data Availability Statement

The data presented in this study are available on request from the corresponding authors due to privacy reasons.

Acknowledgments

The authors wish to thank Nurit Gal for her insights and professional guidance throughout the development of this work. Her expertise and knowledge contributed to and enhanced the quality and depth of the research.

Conflicts of Interest

The authors declare no conflict of interest.

Abbreviations and Nomenclature

AbbreviationMeaning
RESsRenewable Energy Sources
ACAlternating Current
aFRRsAutomated Frequency Restoration Reserves
ANSIAmerican National Standards Institute
ASsAncillary Services
BGBalancing Group
BPMsBusiness Practice Manuals
CAISOCalifornia Independent System Operator
DAMDay-Ahead Market
DERsDistributed Energy Resources
DGDistributed Generation
DRESsDistributed Renewable Energy Sources
DSMDemand Side Management
DSOsDistribution System Operators
ECEuropean Commission
EEGGerman Renewable Energy Act
EMSEnergy Management System
ENTSO-EEuropean Network of Transmission System Operators for Electricity
EnWGGermany Energy Industry Act
F-ASFrequency AS
FCRFrequency Containment Reserve
FERCEnergy Regulatory Commission
GWGigawatt(s)
HzHertz
IEAIsrael Electricity Authority
IECIsrael Electric Corporation
IFMIntegrated Forward Market
ITInformation Technology
kWKilowatt(s)
LVLow Voltage
mFRRsmanual Frequency Restoration Reserves
MVMedium Voltage
MWMegawatt(s)
NERCNorth American Electric Reliability Corporation
NF-ASNon-Frequency AS
PNodesPricing Nodes
PVPhotovoltaic
REsRenewable Energies
RRReplacement Reserve
RTMReal-Time Market
SGsSynchronous Generators
SOsSystem Operators
StromNZVGerman Electricity Network Access Ordinance
StSysStorage Systems
TSOsTransmission System Operators
VREVariable Renewable Energy
WECCWestern Electricity Coordinating Council
TermDefinition
AggregatorActor grouping generation systems act as single entities when engaging in the electricity markets.
Balancing GroupRepresent all accounts of power producers and consumers managed by a balancing responsible party.
Balancing Service ProviderAn entity in charge of submitting energy balancing bids.
Capacity MarketA mechanism for revenue provision to power generation owners for their availability to supply power when needed.
Day-Ahead MarketBuying and selling electricity on the day before the production and delivery.
Demand ResponseBalancing demand by encouraging consumers to change consumption patterns to match the actual power supply.
Flexibility MeasuresActions and mechanisms are taken to balance supply and demand and support the power grid’s operability.
Integrated Forward MarketMarket for determining the best use of resources while seeking the least costly allocation.
Market-Based ProcurementProcurement of electricity through competitive, transparent markets where prices are based on supply and demand rather than on regulated tariffs.
Pricing Nodes Specific locations on the power system where the system operator calculates prices.
Real-Time MarketNear real-time, short-term market for balancing and dispatching supply, demand, and ancillary services.
Self-Loading SystemsAutonomous self-provision of generation units with electricity needs without direct dispatching from the system operator.
Self-Provided Ancillary ServicesGrid-supporting functions supplied by market participants using their own resources.
Time-of-Use TariffsApplication of different prices at different times of the day.

References

  1. Dimitriev, O.P. Global energy consumption rates: Where is the limit? Sustain. Energy 2013, 1, 1–6. Available online: http://pubs.sciepub.com/rse/1/1/1 (accessed on 26 May 2025).
  2. UNFCCC. Paris Agreement. 2015. Available online: https://unfccc.int/files/meetings/paris_nov_2015/application/pdf/paris_agreement_english_.pdf (accessed on 26 May 2025).
  3. UNFCCC. Decision-/CP.26 Glasgow Climate Pact. 2021. Available online: https://unfccc.int/sites/default/files/resource/cop26_auv_2f_cover_decision.pdf (accessed on 26 May 2025).
  4. International Renewable Energy Agency. Renewable Energy Statistics 2024; International Renewable Energy Agency: Abu Dhabi, United Arab Emirates, 2024; Available online: https://www.irena.org/-/media/Files/IRENA/Agency/Publication/2024/Jul/IRENA_Renewable_Energy_Statistics_2024.pdf (accessed on 26 May 2025).
  5. IPCC. Global Warming of 1.5 °C. An IPCC Special Report on the Impacts of Global Warming of 1.5 °C Above Pre-Industrial Levels and Related Global Greenhouse Gas Emission Pathways, in the Context of Strengthening the Global Response to the Threat of Climate Change, Sustainable Development, and Efforts to Eradicate Poverty WG I WG II WG III. 2018. Available online: https://www.ipcc.ch/site/assets/uploads/sites/2/2022/06/SR15_Full_Report_HR.pdf (accessed on 26 May 2025).
  6. European Network of Transmission System Operators for Electricity (ENTSO-E); European Federation of Local Energy Companies (CEDEC); European Distribution System Operators for Smart Grids (EDSO for Smart Grids); Union of the Electricity Industry (EURELECTRIC); European Association of Independent Distribution Companies of Electricity and Gas (GEODE). TSO-DSO Report: An Integrated Approach to Active System Management with a Focus on TSO-DSO Coordination in Congestion Management and Balancing. 2019. Available online: https://docstore.entsoe.eu/Documents/Publications/Position%20papers%20and%20reports/TSO-DSO_ASM_2019_190416.pdf (accessed on 26 May 2025).
  7. Demoulias, C.S.; Malamaki, K.-N.D.; Gkavanoudis, S.; Mauricio, J.M.; Kryonidis, G.C.; Oureilidis, K.O.; Kontis, E.O.; Martinez Ramos, J.L. Ancillary Services Offered by Distributed Renewable Energy Sources at the Distribution Grid Level: An Attempt at Proper Definition and Quantification. Appl. Sci. 2020, 10, 7106. [Google Scholar] [CrossRef]
  8. American National Standards Institute, Inc. Electric Power Systems and Equipment-Voltage Ratings (60 Hertz). 2020. Available online: https://www.nema.org/docs/default-source/standards-document-library/ansi-c84-1-2020-contents-and-scope8cb6b1da-0402-4cde-a8ad-83177d02ae0f.pdf?sfvrsn=cb66d1e6_3 (accessed on 26 May 2025).
  9. European Union. Regulation (EC) No 714/2009 of the European Parliament and of the Council of 13 July 2009 on Conditions for Access to the Network for Cross-Border Exchanges in Electricity and Repealing Regulation (EC) No 1228/2003. Official Journal of the European Union. 2009. Available online: http://data.europa.eu/eli/reg/2009/714/oj (accessed on 26 May 2025).
  10. Israel Ministry of Labor and Welfare. The Electricity Regulations. 1985. Available online: https://www.nevo.co.il/law_html/law01/159_015.htm (accessed on 26 May 2025).
  11. ENTSO-E. Frequency Ranges. ENTSO-E Guidance Document for National Implementation of Frequency Ranges for Network Codes on Grid Connection. 2021. Available online: https://eepublicdownloads.entsoe.eu/clean-documents/Network%20codes%20documents/NC%20RfG/210412_IGD_Frequency_ranges.pdf (accessed on 26 May 2025).
  12. Weinstock, D.; Elran, M.; Altshuler, A.; Ganani, E.; Netanyahu, S.; Parness, E.; Steiner, A.; Toledano, S. Securing the Electrical System in Israel: Proposing a Grand Strategy; Memorandum No. 165; Institute for National Security Studies (INSS): Tel Aviv, Israel, 2017; Available online: https://www.inss.org.il/wp-content/uploads/2017/06/memo165.pdf (accessed on 26 May 2025).
  13. National Grid ESO (Electricity System Operator). SOF Report—Frequency and Voltage Assessment. 2018. Available online: https://www.nationalgrideso.com/document/118651/download (accessed on 26 May 2025).
  14. Strunck, C.; Albrecht, M.; Rehtanz, C. Provision of Ancillary Services by different Decentralised Energy Resources. In Proceedings of the IEEE PowerTech Conference, Milan, Italy, 23–27 June 2019. [Google Scholar] [CrossRef]
  15. Ruester, S.; Schwenen, S.; Batlle, C.; Pérez-Arriaga, I. From distribution networks to smart distribution systems: Rethinking the regulation of European electricity DSOs. Util. Policy 2014, 31, 229–237. [Google Scholar] [CrossRef]
  16. Pepermans, G.; Driesen, J.; Haeseldonckx, D.; Belmans, R.; D’haeseleer, W. Distributed generation: Definition, benefits and issues. Energy Policy 2005, 33, 787–798. [Google Scholar] [CrossRef]
  17. Kost, C.; Shammugam, S.; Fluri, V.; Peper, D.; Davoodi Memar, A.; Schlegl, T. Levelized Cost of Electricity Renewable Energy Technologies; Fraunhofer Institute for Solar Energy Systems ISE: Freiburg im Breisgau, Germany, 2021; Available online: https://www.ise.fraunhofer.de/content/dam/ise/en/documents/publications/studies/EN2021_Fraunhofer-ISE_LCOE_Renewable_Energy_Technologies.pdf (accessed on 26 May 2025).
  18. Guerra, K.; Haro, P.; Gutiérrez, R.E.; Gómez-Barea, A. Facing the high share of variable renewable energy in the power system: Flexibility and stability requirements. Appl. Energy 2022, 310, 118561. [Google Scholar] [CrossRef]
  19. European Union. Regulation (EU) 2017/1485 of 2 August 2017 Establishing a Guideline on Electricity Transmission System Operation. Off. J. Eur. Union 2017. Available online: http://data.europa.eu/eli/reg/2017/1485/oj (accessed on 26 May 2025).
  20. Fernández-Muñoz, D.; Pérez-Díaz, J.I.; Guisández, I.; Chazarra, M.; Fernández-Espina, Á. Fast frequency control AS: An international review. Renew. Sustain. Energy Rev. 2020, 120, 109662. [Google Scholar] [CrossRef]
  21. Anderson, B.; Reilly, J.; Krishnan, V. Load Control for Frequency Response-A Literature Review; National Renewable Energy Laboratory: Golden, CO, USA, 2022. Available online: https://www.nrel.gov/docs/fy22osti/77780.pdf (accessed on 26 May 2025).
  22. Schermeyer, H.; Vergara, C.; Fichtner, W. Renewable energy curtailment: A case study on today’s and tomorrow’s congestion management. Energy Policy 2018, 112, 427–436. [Google Scholar] [CrossRef]
  23. Peng, F.Z.; Liu, C.-C.; Li, Y.; Jain, A.K.; Vinnikov, D. Envisioning the future renewable and resilient energy grids—A power grid revolution enabled by renewables, energy storage, and energy electronics. IEEE J. Emerg. Sel. Top. Ind. Electron. 2024, 5, 8–26. [Google Scholar] [CrossRef]
  24. Deutsche Energie-Agentur GmbH (dena)—German Energy Agency; 50Hertz Transmission GmbH; ABB AG; Amprion GmbH; BELECTRIC Solarkraftwerke GmbH; E.DIS AG; ENERCON GmbH; EWE Netz GmbH; Mitteldeutsche Netzgesellschaft Strom mbH; N-ERGIE Netz GmbH; et al. dena Ancillary Services Study 2030: Security and Reliability of a Power Supply with a High Percentage of Renewable Energy—Summary of the Key Results of the Study by the Project Steering Group; Deutsche Energie-Agentur GmbH (dena): Berlin, Germany, 2014; Available online: https://erranet.org/download/dena-ancillary-services-study-2030/?wpdmdl=33268 (accessed on 26 May 2025).
  25. Barth, A.; González, D.; Gonzalez, J.L.; Hanzlík, V.; Pinheiro, G.; Tai, H.; Weiss, A. How Grid Operators Can Integrate the Coming Wave of Renewable Energy; McKinsey & Company: Chicago, IL, USA, 2024; Available online: https://www.mckinsey.com/capabilities/sustainability/our-insights/how-grid-operators-can-integrate-the-coming-wave-of-renewable-energy (accessed on 26 May 2025).
  26. European Network of Transmission System Operators for Electricity. ENTSO-E Annual Work Programme 2025 Edition-ENTSO-E’s Work on Legal Mandates. 2024. Available online: https://consultations.entsoe.eu/markets/consultation-awp-2025/supporting_documents/240705_ENTSOE_AWP2025.pdf (accessed on 26 May 2025).
  27. Oureilidis, K.; Demoulias, C.; Martinez Ramos, J.L.; Vargas, A.A.; Machado, F.C.; Gallos, K.G.; Dikaiakos, C.; Jerele, M.; Littwitz, E.; Schneider, C. D5.2 Report Presenting the Portfolio of Ancillary Services; European Union’s Horizon 2020 Research and Innovation Programme; European Union: Brussels, Belgium, 2019; Available online: https://ec.europa.eu/research/participants/documents/downloadPublic?documentIds=080166e5c1fd0d68&appId=PPGMS (accessed on 26 May 2025).
  28. Lotz, M.R.; Majumdar, N.; Beutel, V.; Gerlach, J.; Wegkamp, C.; Hoffmann, M.; von Maydell, K. Potentials and technical requirements for the provision of AS in future power systems with distributed energy resources. In Proceedings of the NEIS 2021, Conference on Sustainable Energy Supply and Energy Storage Systems, Hamburg, Germany, 13–14 September 2021; VDE: Frankfurt am Main, Germany, 2021; pp. 1–8. Available online: https://www.researchgate.net/publication/358425233_Potentials_and_Technical_Requirements_for_the_Provision_of_Ancillary_Services_in_Future_Power_Systems_with_Distributed_Energy_Resources (accessed on 26 May 2025).
  29. Oureilidis, K.; Malamaki, K.-N.; Gallos, K.; Tsitsimelis, A.; Dikaiakos, C.; Gkavanoudis, S.; Cvetkovic, M.; Mauricio, J.M.; Maza Ortega, J.M.; Ramos, J.L.M.; et al. Ancillary Services Market Design in Distribution Networks: Review and Identification of Barriers. Energies 2020, 13, 917. [Google Scholar] [CrossRef]
  30. European Union. Regulation (EU) 2016/1388 of 17 August 2016 Establishing a Network Code on Demand Connection. Off. J. Eur. Union 2016. Available online: http://data.europa.eu/eli/reg/2016/1388/oj (accessed on 26 May 2025).
  31. European Union. Regulation (EU) 2016/631 of 14 April 2016 Establishing a Network Code on Requirements for Grid Connection of Generators. Off. J. Eur. Union 2016. Available online: http://data.europa.eu/eli/reg/2016/631/oj (accessed on 26 May 2025).
  32. Union for the Coordination of Transmission of Electricity. Technical Paper-Definition of a Set of Requirements to Generating Units; Union for the Coordination of Transmission of Electricity: Brussels, Belgium, 2008; pp. 1–21. Available online: https://eepublicdownloads.entsoe.eu/clean-documents/pre2015/news/Technical_Paper-Requirements_to_generators.pdf (accessed on 26 May 2025).
  33. European Union. Regulation (EU) 2017/2195 of 23 November 2017 Establishing a Guideline on Electricity Balancing. Off. J. Eur. Union 2017. Available online: http://data.europa.eu/eli/reg/2017/2195/oj (accessed on 26 May 2025).
  34. Gerard, H.; Rivero, E.; Six, D. Basic Schemes for TSO-DSO Coordination and AS Provision; European Commission: Brussels, Belgium, 2017; Available online: https://smartnet-project.eu/wp-content/uploads/2016/12/D1.3_20161202_V1.0.pdf (accessed on 26 May 2025).
  35. Capitanescu, F. TSO–DSO interaction: Active distribution network power chart for TSO AS provision. Electr. Power Syst. Res. 2018, 163, 226–230. [Google Scholar] [CrossRef]
  36. Schittekatte, T.; Reif, V.; Meeus, L. The EU Electricity Network Codes–Technical Report; European University Institute, Robert Schuman Centre for Advanced Studies: Florence, Italy, 2019; Available online: https://data.europa.eu/doi/10.2870/188992 (accessed on 26 May 2025).
  37. Consentec GmbH. Beschreibung von Konzepten des Systemausgleichs und der Regelreservemärkte in Deutschland; Consentec GmbH: Aachen, Germany, 2022; Available online: https://www.regelleistung.net/Portals/1/downloads/modalit%C3%A4ten_rahmenvertraege/marktbeschreibung/Beschreibung%20Systemausgleich%20und%20Regelreservem%C3%A4rkte.pdf?ver=59xjKd40j35myZLiBqItrw%3D%3D (accessed on 26 May 2025). (In German)
  38. European Network of Transmission System Operators for Electricity. ENTSO-E Automatic Frequency Restoration Reserve Process Implementation Guide. n.d. Available online: https://www.entsoe.eu/Documents/EDI/Library/ERRP/Automatic_Frequency_Restoration_Reserve_Process_v1.1.pdf (accessed on 26 May 2025).
  39. Yusoff, N.I.; Zin, A.A.M.; Bin Khairuddin, A. Congestion management in power system: A review. In Proceedings of the 2017 3rd International Conference on Power Generation Systems and Renewable Energy Technologies (PGSRET), Johor Bahru, Malaysia, 4–6 April 2017. [Google Scholar] [CrossRef]
  40. European Union. Regulation (EU) 2015/1222 of 24 July 2015 Establishing a Guideline on Capacity Allocation and Congestion Management. Off. J. Eur. Union 2015. Available online: http://data.europa.eu/eli/reg/2015/1222/oj (accessed on 26 May 2025).
  41. Hadush, S.Y.; Meeus, L. DSO-TSO cooperation issues and solutions for distribution grid congestion management. Energy Policy 2018, 120, 610–621. [Google Scholar] [CrossRef]
  42. Alizadeh, M.I.; Usman, M.; Capitanescu, F.; Madureira, A.G. A Novel TSO-DSO Ancillary Service Procurement Coordination Approach for Congestion Management. In Proceedings of the 2022 IEEE Power & Energy Society General Meeting (PESGM), Denver, CO, USA, 17–21 July 2022; IEEE: New York City, NY, USA, 2022; pp. 1–5. [Google Scholar] [CrossRef]
  43. Tang, Y.; Wan, Q.L.; Yuan, F. A new method for assessing ancillary service of FACTS in congestion management. In Proceedings of the 2007 IEEE Power Engineering Society General Meeting, Tampa, FL, USA, 24–28 June 2007; IEEE: New York City, NY, USA, 2007; pp. 1–7. [Google Scholar] [CrossRef]
  44. Lind, L.; Cossent, R.; Chaves-Ávila, J.P.; Gómez San Román, T. Transmission and distribution coordination in power systems with high shares of distributed energy resources providing balancing and congestion management services. WIREs Energy Environ. 2019, 8, e357. [Google Scholar] [CrossRef]
  45. Federal Network Agency. Monitoring Report; Federal Network Agency: Bonn, Germany, 2022; Available online: https://data.bundesnetzagentur.de/Bundesnetzagentur/SharedDocs/Mediathek/Monitoringberichte/monitoringberichtenergie2022.pdf (accessed on 26 May 2025). (In German)
  46. Bundesnetzagentur für Elektrizität, Gas, Telekommunikation, Post und Eisenbahnen. Flexibility in the Electricity System; Bundesnetzagentur für Elektrizität, Gas, Telekommunikation, Post und Eisenbahnen: Bonn, Germany, 2017; Available online: https://www.bundesnetzagentur.de/SharedDocs/Downloads/EN/Areas/ElectricityGas/FlexibilityPaper_EN.pdf?__blob=publicationFile&v=2 (accessed on 26 May 2025).
  47. Bundesnetzagentur; Bundeskartellamt. Monitoring Report 2021—Key Findings and Summary; Bundeskartellamt: Bonn, Germany, 2022; Available online: https://www.bundeskartellamt.de/SharedDocs/Publikation/EN/Berichte/Energie-Monitoring-2021.pdf?__blob=publicationFile&v=3 (accessed on 26 May 2025).
  48. Van den Bergh, K.; Couckuyt, D.; Delarue, E.; D’haeseleer, W. Redispatching in an interconnected electricity system with high renewables penetration. Electr. Power Syst. Res. 2015, 127, 64–72. [Google Scholar] [CrossRef]
  49. Bundesministeriums der Justiz sowie des Bundesamts für Justiz. Electricity Grid Access Ordinance (Stromnetzzugangsverordnung—Strom NZV). Bundesgesetzblatt 2005, 46, 2243–2251. Available online: https://www.gesetze-im-internet.de/stromnzv/StromNZV.pdf (accessed on 26 May 2025).
  50. Bundesministeriums der Justiz und für Verbraucherschutz in Zusammenarbeit mit der juris GmbH. Energy Industry Act (EnWG). Gesetz über die Elektrizitäts-und Gasversorgung (Energiewirtschaftsgesetz—EnWG)—Electricity and Gas Supply Act (Energy Industry Act). 2005. Available online: https://www.gesetze-im-internet.de/enwg_2005/EnWG.pdf (accessed on 26 May 2025).
  51. German National Academy of Sciences Leopoldina. Grid Congestion as a Challenge for the Electricity System. Acatech—National Academy of Science and Engineering. 2021. Available online: https://en.acatech.de/publication/grid-congestion-as-a-challenge-electricity-system/download-pdf/?lang=en (accessed on 26 May 2025).
  52. Bundesnetzagentur für Elektrizität, Gas, Telekommunikation, Post und Eisenbahnen. Feststellung des Bedarfs an Netzreserve für den Winter 2022/2023 Sowie den Betrachtungszeitraum April 2023 bis März 2024. Bundesnetzagentur.de. 2023. Available online: https://www.bundesnetzagentur.de/DE/Fachthemen/ElektrizitaetundGas/Versorgungssicherheit/Netzreserve/DL/Feststellung_Netzreservebedarf_2022.pdf?__blob=publicationFile&v=1 (accessed on 26 May 2025).
  53. Ghazvini, M.A.F.; Lipari, G.; Pau, M.; Ponci, F.; Monti, A.; Soares, J.; Vale, Z. Congestion management in active distribution networks through demand response implementation. Sustain. Energy Grids Netw. 2019, 17, 100185. [Google Scholar] [CrossRef]
  54. Shen, J.; Jiang, C.; Li, B. Controllable Load Management Approaches in Smart Grids. Energies 2015, 8, 11187–11202. [Google Scholar] [CrossRef]
  55. Liere-Netheler, I.; Schuldt, F.; Maydell, K.; Agert, C. Optimised curtailment of distributed generators for the provision of congestion management services considering discrete controllability. IET Gener. Transm. Distrib. 2020, 14, 735–744. [Google Scholar] [CrossRef]
  56. Valarezo, O.; Gómez, T.; Chaves-Avila, J.P.; Lind, L.; Correa, M.; Ulrich Ziegler, D.; Escobar, R. Analysis of New Flexibility Market Models in Europe. Energies 2021, 14, 3521. [Google Scholar] [CrossRef]
  57. Idoko, L.; Anaya-Lara, O.; Campos-Gaona, D. Voltage control AS for low voltage distributed generation. Int. J. Smart Grid Clean Energy 2018, 7, 98–108. [Google Scholar] [CrossRef]
  58. Oladimeji, O.; Sigrist, L.; Ortega, Á. Guaranteeing the Provision of Primary Frequency Control Services by Distributed Generation. In Proceedings of the 2022 IEEE PES Innovative Smart Grid Technologies Conference Europe (ISGT-Europe), Novi Sad, Serbia, 10–13 October 2022; IEEE: New York City, NY, USA, 2023; pp. 1–5. [Google Scholar] [CrossRef]
  59. Troncia, M.; Ávila, J.P.C.; Pilo, F.; Román, T.G.S. Remuneration mechanisms for investment in reactive power flexibility. Sustain. Energy Grids Netw. 2021, 27, 100507. [Google Scholar] [CrossRef]
  60. Rancilio, G.; Rossi, A.; Falabretti, D.; Galliani, A.; Merlo, M. Ancillary services markets in Europe: Evolution and regulatory trade-offs. Renew. Sustain. Energy Rev. 2022, 154, 111850. [Google Scholar] [CrossRef]
  61. Gerard, H.; Rivero Puente, E.I.; Six, D. Coordination between transmission and distribution system operators in the electricity sector: A conceptual framework. Util. Policy 2018, 50, 40–48. [Google Scholar] [CrossRef]
  62. Banshwar, A.; Sharma, N.K.; Sood, Y.R.; Shrivastava, R. Renewable energy sources as a new participant in ancillary service markets. Energy Strategy Rev. 2017, 18, 106–120. [Google Scholar] [CrossRef]
  63. Morthorst, P.E.; Ray, S.; Munksgaard, J.; Sinner, A.F. Wind Energy and Electricity Prices: Exploring the ‘Merit Order Effect’. European Wind Energy Association. 2010. Available online: http://www.ewea.org/fileadmin/files/library/publications/reports/MeritOrder.pdf (accessed on 26 May 2025).
  64. Antweiler, W.; Muesgens, F. On the long-term merit order effect of renewable energies. Energy Econ. 2021, 99, 105275. [Google Scholar] [CrossRef]
  65. European Union. Directive (EU) 2019/944 of the European Parliament and of the Council of 5 June 2019 on Common Rules for the Internal Market for Electricity and Amending Directive 2012/27/EU. 2019. Available online: https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32019L0944 (accessed on 26 May 2025).
  66. European Union. Regulation (EU) 2019/943 of the European Parliament and of the Council of 5 June 2019 on the Internal Market for Electricity. 2019. Available online: https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32019R0943 (accessed on 26 May 2025).
  67. Cicala, S. Imperfect Markets versus Imperfect Regulation in US Electricity Generation. Am. Econ. Rev. 2022, 112, 409–441. [Google Scholar] [CrossRef]
  68. Viola, L.; Mohammadi, S.; Dotta, D.; Hesamzadeh, M.R.; Baldick, R.; Flynn, D. Ancillary services in power system transition toward a 100% non-fossil future: Market design challenges in the United States and Europe. Electr. Power Syst. Res. 2024, 236, 110885. [Google Scholar] [CrossRef]
  69. NOGA—Israel Independent System Operator Ltd. The Network Regulations for the National Electricity System (Grid Code). March 2023. Available online: https://www.noga-iso.co.il/media/hq2aofub/%D7%AA%D7%A7%D7%A0%D7%95%D7%9F-%D7%A8%D7%A9%D7%AA-%D7%92%D7%A8%D7%A1%D7%90-1-03-23.pdf (accessed on 26 May 2025).
  70. European Association for Storage of Energy (EASE). EASE Study on Power System Challenges of Islands and Isolated Systems with High Shares of Variable Renewables; EASE: Brussels, Belgium, 2020; Available online: https://ease-storage.eu/wp-content/uploads/2020/04/EASE-Study-on-Power-System-Challenges-of-Islands-and-Isolated-Systems.pdf (accessed on 26 May 2025).
  71. Fakhouri, A.; Kuperman, A. Backup of Renewable Energy for an Electrical Island: Case Study of Israeli Electricity System-Current Status. Sci. World J. 2014, 2014, 609687. [Google Scholar] [CrossRef]
  72. Handique, A.J.; Peer, R.A.M.; Haas, J. Understanding the Challenges for Modelling Islands’ Energy Systems and How to Solve Them. Curr. Sustain. Renew. Energy Rep. 2024, 95, 95–104. [Google Scholar] [CrossRef]
  73. Ministry of Energy. Roadmap to 2030: Achieving a 30% Renewable Energy Share in Israel’s Electricity Mix; Ministry of Energy: Jerusalem, Israel, 2023; pp. 26–35. Available online: https://www.gov.il/BlobFolder/news/re_290522/he/roadmap_reference_2030.pdf (accessed on 26 May 2025).
  74. Israel Electricity Authority. Status Report—Renewable Energy Goals in the Electricity Sector; The Electricity Authority: Jerusalem, Israel, 2022; pp. 1–7. Available online: https://www.gov.il/BlobFolder/news/doch_yeadim_new_energy/he/Files_Doveret_press_doch_yaad_mithadshot_03_2022_n.pdf (accessed on 26 May 2025).
  75. Israel Electricity Authority. Electricity Market Status Report, 2023 Overview and Trends for 2024; Israel Electricity Authority: Jerusalem, Israel, 2024. Available online: https://www.gov.il/BlobFolder/generalpage/dochmeshek/he/Files_doch_meshek_hashmal_doch_meshek_2023_nnn.pdf (accessed on 26 May 2025).
  76. Government of Israel. Decision 4080: The 2018 Resolution on Energy Policy; Government of Israel: Jerusalem, Israel, 2018. Available online: https://www.gov.il/he/pages/dec4080_2018 (accessed on 26 May 2025). (In Hebrew)
  77. Knesset Research Center. Renewable Energy in Israel; Knesset Research and Information Center: Jerusalem, Israel, 2023. Available online: https://fs.knesset.gov.il/globaldocs/MMM/694b85d6-ab73-ed11-8155-005056aa4246/2_694b85d6-ab73-ed11-8155-005056aa4246_11_20199.pdf (accessed on 26 May 2025).
  78. Rettig, E.; Fischhendler, I.; Schlecht, F. The meaning of energy islands: Towards a theoretical framework. Renew. Sustain. Energy Rev. 2023, 187, 113732. [Google Scholar] [CrossRef]
  79. Mittelman, G.; Eran, R.; Zhivin, L.; Eisenhändler, O.; Luzon, Y.; Tshuva, M. The potential of renewable electricity in isolated grids: The case of Israel in 2050. Appl. Energy 2023, 349, 121325. [Google Scholar] [CrossRef]
  80. Ben Yosef, G.; Navon, A.; Poliak, O.; Etzion, N.; Gal, N.; Belikov, J.; Levron, Y. Frequency stability of the Israeli power grid with high penetration of renewable sources and energy storage systems. Energy Rep. 2021, 7, 6148–6161. [Google Scholar] [CrossRef]
  81. NOGA—Israel Electric Transmission System Operator. Outline for Establishing an Ancillary Service. March 2024. Available online: https://www.noga-iso.co.il/media/gltcmxjo/%D7%9E%D7%AA%D7%95%D7%95%D7%94-%D7%9C%D7%94%D7%A7%D7%9E%D7%AA-%D7%A9%D7%99%D7%A8%D7%95%D7%AA-%D7%A0%D7%99%D7%9C%D7%95%D7%95%D7%94-%D7%9E%D7%A8%D7%A5-2024.pdf (accessed on 26 May 2025).
  82. Navon, A.; Kulbekov, P.; Dolev, S.; Yehuda, G.; Levron, Y. Integration of distributed RES in Israel: Transmission congestion challenges and policy recommendations. Energy Policy 2020, 140, 111412. [Google Scholar] [CrossRef]
  83. Israel Electricity Authority. Decision 62704: Regulation for Producers of Renewable Energy Connected to the High-Voltage Grid; Israel Electricity Authority: Jerusalem, Israel, 2022. Available online: https://www.gov.il/BlobFolder/policy/62704/he/Files_Hachlatot_62704_n.pdf (accessed on 26 May 2025).
  84. Israel Independent System Operator—Noga. An Integrative Development Plan for the Production and Delivery System Until 2023; Israel Independent System Operator: Jerusalem, Israel, 2022; Available online: https://shituf.inql.co.il/wp-content/uploads/2022/08/%D7%AA%D7%9B%D7%A0%D7%99%D7%AA-%D7%9E%D7%9C%D7%90%D7%94-%D7%A4%D7%99%D7%AA%D7%95%D7%97-%D7%90%D7%99%D7%A0%D7%98%D7%92%D7%A8%D7%98%D7%99%D7%91%D7%99%D7%AA-%D7%A2%D7%93-2030-2022-08.pdf (accessed on 26 May 2025). (In Hebrew)
  85. Aharonovich, I. 2024. NOGA Advances AS in Israel’s Electricity Market. The Marker. 25 March 2024. Available online: https://www.themarker.com/labels/energy2024/2024-03-25/ty-article-labels/0000018e-753e-d637-abbf-f7be1ab00000 (accessed on 30 April 2025).
  86. State Comptroller of Israel. Development of the Electricity Sector Towards 2030: Part B of the Annual Report 75A; State Comptroller of Israel: Jerusalem, Israel, 2024. Available online: https://www.mevaker.gov.il/sites/DigitalLibrary/Documents/2024/2024.11-75A-PartB/2024.11-75A-PartB-202-Electricity-2030.pdf (accessed on 26 May 2025).
  87. Israel Electricity Authority. Service Quality Standards Guide; Israel Public Utility Authority for Electricity: Jerusalem, Israel, 2024. Available online: https://www.gov.il/BlobFolder/generalpage/amotmidabook/he/Files_General_sefer_am_12_2024.pdff (accessed on 26 May 2025).
  88. Israel Electric Corporation. Conditions for Connecting Photovoltaic Production Facilities to the High Voltage System; Israel Public Utility Authority for Electricity: Jerusalem, Israel, 2018. Available online: https://www.gov.il/BlobFolder/policy/55011/he/Files_Hachlatot_55011_1304_nisp_yod_7.pdf (accessed on 26 May 2025).
  89. Israel Electricity Authority. Appendix B to Standard 47: Tariff Updates for Standard 47–Smart Consumption Scheme and Voluntary Load Shedding Scheme. Meeting of July 16, 2023, Decision No. 66103. Available online: https://www.gov.il/BlobFolder/policy/66103/he/Files_Hachlatot_66103_nisp_b.pdf (accessed on 26 May 2025).
  90. Israel Electricity Authority. Appendix to Decision on Standard 47: Update to the Voluntary Load Shedding Scheme 2023. Meeting of July 16, 2023, Decision No. 66103. Available online: https://www.gov.il/BlobFolder/policy/66103/he/Files_Hachlatot_66103_nisp_a.pdf (accessed on 26 May 2025).
  91. Israel Electricity Authority. Standard 47: Tariff Updates for Voluntary Load Shedding and Smart Consumption Scheme. Meeting of July 16, 2023, Decision No. 66103. Available online: https://www.gov.il/BlobFolder/policy/66103/he/Files_Hachlatot_66103.pdf (accessed on 26 May 2025).
  92. California Independent System Operator Corporation. Fifth Replacement Electronic Tariff, Section 8: Ancillary Services; California Independent System Operator Corporation: Folsom, CA, USA, 2023; Available online: https://www.caiso.com/Documents/Section8-AncillaryServices-asof-Feb11-2023.pdf (accessed on 26 May 2025).
  93. California Independent System Operator Corporation. Business Practice Manual for Market Operations (Version 91); California Independent System Operator Corporation: Folsom, CA, USA, 2023; Available online: https://bpmcm.caiso.com/BPM%20Document%20Library/Market%20Operations/BPM_for_Market%20Operations_V91_Redline.pdf (accessed on 26 May 2025).
  94. California Independent System Operator Corporation. Appendix K: Ancillary Service Requirements Protocol (ASRP) as of December 15, 2021; California Independent System Operator Corporation: Folsom, CA, USA, 2021; Available online: https://www.caiso.com/Documents/appendixk-ancillaryservicerequirementsprotocol-asrp-asof-dec15-2021.pdf (accessed on 26 May 2025).
  95. Bundesnetzagentur; Bundeskartellamt. Monitoringbericht gemäß § 63 Abs. 3 i. V. m. § 35 EnWG und § 48 Abs. 3 i. V. m. § 53 Abs. 3 GWB (Monitoringbericht 2023); Bundeskartellamt: Bonn, Germany, 2023; Available online: https://data.bundesnetzagentur.de/Bundesnetzagentur/SharedDocs/Mediathek/Monitoringberichte/MonitoringberichtEnergie2023.pdf (accessed on 26 May 2025).
  96. Wagner, C.; Bucksteeg, M.; Schlecht, I.; Lehnert, W.; Kramer, H.; Burges, K.; Greve, M.; Strunck, C. Zukünftiger Bedarf und Beschaffung von Systemdienstleistungen (SDL-Zukunft)—Final Report; Bundesministerium für Wirtschaft und Klimaschutz: Berlin, Germany, 2022; Available online: https://www.bmwk.de/Redaktion/DE/Publikationen/Energie/abschlussbericht-zukunftiger-bedarf-und-beschaffung-von-systemdienst-leistungen-sdl-zukunft.pdf?__blob=publicationFile&v=8 (accessed on 26 May 2025).
  97. Bendig, M.; Pfeiffer, K.; Kuprat, M.; Butter, E.; Platta, K. Systemdienstleistungen für Netz- und Systemsicherheit: Studie im Rahmen des Fachforums Energiewende des Landes Brandenburg; Brandenburg University of Technology Cottbus-Senftenberg: Cottbus, Germany, 2018; Available online: https://mwae.brandenburg.de/media/bb1.a.3814.de/SDL_Studie_BB_Abschlussbericht.pdf (accessed on 26 May 2025).
  98. WindNODE. Flexibilität, Markt und Regulierung: Synthesebericht des Förderprogramms Sinteg; Bundesministerium für Wirtschaft und Energie (BMWi): Berlin, Germany, 2020; Available online: https://www.bmwk.de/Redaktion/DE/Publikationen/Sinteg/windnode-erkenntnisse-flexibilitat-markt-und-regulierung.pdf?__blob=publicationFile&v=6 (accessed on 26 May 2025).
  99. Bundesministerium der Justiz. Erneuerbare-Energien-Gesetz (EEG 2023); Bundesministerium der Justiz: Berlin, Germany, 2023; Available online: https://www.gesetze-im-internet.de/eeg_2014/EEG_2023.pdf (accessed on 26 May 2025).
Figure 1. Energy mix in Israel, 2023 (https://www.iea.org/countries/israel/energy-mix, accessed on 26 May 2025).
Figure 1. Energy mix in Israel, 2023 (https://www.iea.org/countries/israel/energy-mix, accessed on 26 May 2025).
Energies 18 02836 g001
Figure 5. Energy mix in Germany, 2023 (https://www.iea.org/countries/germany/energy-mix, accessed on 26 May 2025).
Figure 5. Energy mix in Germany, 2023 (https://www.iea.org/countries/germany/energy-mix, accessed on 26 May 2025).
Energies 18 02836 g005
Table 1. AS provision and procurement in California.
Table 1. AS provision and procurement in California.
ServiceWhere ProvidedWhere ProcuredProcured ByHow OftenProcurement ModelType of Generation/Storage Units Participating
Regulation UpTransmissionDAM, RTMCAISODailyPay-as-Bid, Market-BasedLarge Power Plants, Storage (≥100 kW), Demand Response
Regulation DownTransmissionDAM, RTMCAISODailyPay-as-Bid, Market-BasedLarge Power Plants, Storage (≥100 kW), Demand Response
Spinning ReserveTransmissionDAM, RTMCAISODailyMarket-Based, Marginal PricingLarge Power Plants, Storage (≥100 kW), Demand Response
Non-Spinning ReserveTransmissionDAM, RTMCAISODailyMarket-Based, Marginal PricingLarge Power Plants, Storage (≥100 kW)
Voltage ControlTransmission and DistributionMerit-Order Stack, Bilateral ContractsCAISOAs NeededCost-Based for Public Utilities, Market-Based for OthersLarge Power Plants, Some Storage, Industrial Loads
Self-Provided ASTransmissionIFMCAISODailySelf-Provision Allowed if CertifiedAny Certified Generation or Storage
Cascading ProcurementTransmissionRTMCAISOAs NeededMarket-Based, Priority for Higher Quality ASLarge Power Plants, Storage (≥100 kW)
Table 2. AS provision and procurement in Germany.
Table 2. AS provision and procurement in Germany.
ServiceWhere ProvidedWhere ProcuredProcured ByHow OftenProcurement ModelType of Generation/Storage Units Participating
Primary Frequency Control (FCR)TransmissionPan-European AuctionsTSOsWeeklyPay-as-BidLarge Power Plants, Aggregated Small Plants, Batteries, Demand Response
Secondary Frequency Control (aFRR)TransmissionNational AuctionsTSOsDaily (6 blocks of 4 h)Merit-Order Auction (Capacity and Energy Price)Large Power Plants, Batteries, Demand Response
Secondary Frequency Control (mFRR)TransmissionNational AuctionsTSOsDaily (6 blocks of 4 h)Merit-Order Auction (Capacity and Energy Price)Large Power Plants, Batteries, Demand Response
Tertiary Frequency Control (RR)TransmissionNational AuctionsTSOsDaily (6 blocks of 4 h)Merit-Order Auction (Capacity and Energy Price)Large Power Plants, Batteries, Demand Response
Voltage ControlTransmission and DistributionBilateral ContractsTSOs and DSOsPer DemandFixed Tariff or Contractual PaymentsConventional Power Plants, Large-Scale Renewables, Industrial Consumers
Reactive PowerTransmission and DistributionGrid Connection AgreementsTSOs and DSOsPer DemandFixed Tariff or Contractual PaymentsConventional Power Plants, Some Renewables, Industrial Loads
Black StartTransmissionBilateral ContractsTSOsAnnual Capacity Payment + Per Event PaymentCapacity Payment + Pay-as-Bid for ActivationConventional Power Plants with Black Start Capability (Hydro, Gas, Some Coal)
Congestion Management (Redispatch and Curtailment)Transmission and DistributionRedispatch Agreements, Curtailment MechanismsTSOs and DSOsAs NeededCost-Based Redispatch, Compensation per Adjusted MWThermal Power Plants, Large-Scale Renewables, Batteries
Table 3. Recommended AS adoption in Israel.
Table 3. Recommended AS adoption in Israel.
CategoryCalifornia (CA)Germany (DE)Relevance to IsraelImplementation Potentials
Frequency RegulationCAISO procures up and down-regulation services for frequency fluctuations in real-time markets. It requires a quick response within a communicated time frame and amount as needed. Germany uses a multi-tier approach for frequency regulation, using primary, secondary, and tertiary reserves. They are procured through transparent and competitive market mechanisms, where providers are compensated based on capacity availability and activation during frequency fluctuations.Israel heavily relies on gas turbines. As the RES capacity in Israel increases, it must adopt more market-based solutions. Adapting real-time procurement of regulation (similar to California) will incentivise RESs and StSys to participate in frequency regulation. The competitive approach in Germany for reserves provides a model for integrating RES into frequency regulation.Dual-payment model (capacity and activation payments) will incentivise RES and StSy participation in Israel. It will require regulatory changes and new designated market development.
Voltage Control and Reactive PowerCAISO procures voltage support using a merit-order stack based on cost-effectiveness. Regional zones manage local voltage issues.Reactive power compensation in Germany is provided through TSOs and DSOs using transparent, competitive auctions. These services are procured over different voltage levels. Deployed inverters in PV systems to autonomously provide reactive power compensation are sought after in Israel. However, a compensation scheme is yet to be available. Establishing voltage regulation zones in high-RES areas could optimise voltage support services and improve grid stability.Establishing regional zones for voltage control, as seen in California, in different grid levels, as in Germany, and integrating advanced inverters for autonomous reactive power compensation in RES systems can be a proper measure for the Israeli case.
Black StartNo explicit mechanism for black start.Requirements for black start capability from critical plants. Compensation occurs annually with capacity payments and activation payments when used.Israel should further integrate storage systems to provide black start services, ensuring grid resilience.Storage systems would need to meet black start requirements. The storage capacity needs further investment and expansion. Compliance with the infrastructure must be established.
Congestion ManagementLMP is used to incentivise RESs and StSys to provide services in areas with congestion issues. Procured in competitive day-ahead and real-time markets.Redispatch and curtailment are used to manage congestion, with grid reserve capacity contracted through competitive bidding. Costs are passed onto consumers through grid fees.Israel could establish congestion zones like California with a unified compensation mechanism to incentivise RES and StSy to participate in congestion management. A proper remuneration scheme for dynamic grid measures should be created to ensure fair compensation.Establishing LMP and congestion zones in Israel could incentivise RES and StSy to participate in congestion management. The regulatory framework requires a reform to allow dynamic responses.
Regulatory FrameworksOperation under strict national standards, requiring periodic testing and compliance checks for AS providers.AS procurement by TSOs and DSOs through competitive, transparent auctions, ensuring non-discriminatory access for all market participants. Compliance with EU directives ensures market efficiency.A regulatory framework that allows market-based procurement of AS, supporting dynamic participation from RES and StSy is required. The development of certification processes for RE systems and storage technologies is necessary.The regulatory framework in Israel needs a reform to include market-based AS procurement and participation as well as certification and performance. A set of standards is required.
Pricing MechanismsUse of marginal pricing and pay-as-bid models for AS procurement, adjusting for real-time conditions in DAM and RTMUse of pay-as-bid for ASs, with fixed payments for capacity and variable payments for activation. This ensures cost-efficiency and transparent pricing for all participants.A competitive bidding system for ASs, using a dual-compensation system to incentivise RESs and StSys to participate, should be adopted. The pay-as-bid model could help ensure fair compensation for services provided.The pricing system in Israel can be aligned with California and Germany to incentivise RES and StSy participation in AS markets, ensuring market efficiency and fair compensation.
Grid ManagementParticipating systems must be automatically controllable and meet strict EMS response standards.
CAISO manages the grid, focusing on balancing supply and demand in real-time markets. However, the grid needs a flexible management system to handle the growing share of VRE. In addition, CAISO oversees all AS in their grid.
TSOs must maintain reserves for grid constraints. Bilateral agreements require providers to have certain technical attributes, such as amount and availability.
The TSOs and DSOs manage their grid and AS within their grid levels. Investments in infrastructure and system upgrades are planned to support higher RES penetration.
Technical standards for RES and StSy systems must be updated to ensure they meet the required control capabilities and real-time responsiveness.
Adopting advanced grid management techniques such as RTM to manage the intermittency of RESs.
Implementing certification and testing protocols for RESs and StSys could be beneficial. It could be achievable with the right infrastructure and standards.
Additionally, grid management capabilities must be upgraded to allow real-time adjustments to power fluctuations.
Flexibility MeasuresStSys are used to manage RES intermittency and real-time balancing, allowing flexibility to respond to fluctuations. Flexible resources and redispatch are used to manage RES intermittency. TSOs are authorised to redirect generation for real-time power adjustments, managing fluctuations caused by RESs.Implementation of market-based flexibility mechanisms to manage RES fluctuations is required. Storage solutions and demand-side management can be key for flexibility.Introducing flexible scheduling and real-time adjustments in Israel would improve grid stability and promote the integration of more RESs.
Disclaimer/Publisher’s Note: The statements, opinions and data contained in all publications are solely those of the individual author(s) and contributor(s) and not of MDPI and/or the editor(s). MDPI and/or the editor(s) disclaim responsibility for any injury to people or property resulting from any ideas, methods, instructions or products referred to in the content.

Share and Cite

MDPI and ACS Style

Littwitz, E.; Ayalon, O. Feasibility Analysis of Storage and Renewable Energy Ancillary Services for Grid Operations. Energies 2025, 18, 2836. https://doi.org/10.3390/en18112836

AMA Style

Littwitz E, Ayalon O. Feasibility Analysis of Storage and Renewable Energy Ancillary Services for Grid Operations. Energies. 2025; 18(11):2836. https://doi.org/10.3390/en18112836

Chicago/Turabian Style

Littwitz, Evyatar, and Ofira Ayalon. 2025. "Feasibility Analysis of Storage and Renewable Energy Ancillary Services for Grid Operations" Energies 18, no. 11: 2836. https://doi.org/10.3390/en18112836

APA Style

Littwitz, E., & Ayalon, O. (2025). Feasibility Analysis of Storage and Renewable Energy Ancillary Services for Grid Operations. Energies, 18(11), 2836. https://doi.org/10.3390/en18112836

Note that from the first issue of 2016, this journal uses article numbers instead of page numbers. See further details here.

Article Metrics

Back to TopTop