Cost-Effective Decarbonization in a Decentralized Market: The Benefits of Using Flexible Technologies and Resources

Decarbonization of the electricity system will require significant and continued investment in low-carbon energy sources and electrification of the heat and transport sectors. With diminishing output and shorter operating hours of conventional large-scale fossil-fueled generators, there is a growing need and opportunity for distributed energy resources (DERs) to contribute to the provision of system balancing and security services and support a cost-effective transition to a lower-carbon energy system. Emerging smart technologies will open new opportunities for millions of users to participate actively in the trading of electricity and various ancillary services through alternative mechanisms, such as dynamic pricing, local energy markets, security markets, and peer-to-peer (P2P) trading.