The electricity system is transforming due to renewable energy integration, decentralized generation, and digitalization. The traditional unidirectional grid is evolving into a dynamic, bidirectional system with distributed energy resources (DERs) like solar, wind, EVs, and storage. This shift, along with electrification and decarbonization goals, requires enhanced coordination to maintain reliability and efficiency.

By gathering experience and insights gained from global pilot projects in the field of providing flexibility for coordinated capacity management of transmission and distribution system operators, a holistic overview of the ongoing developments in the integration of flexibility can be presented.

The overall study highlights that improved TSO-DSO-stakeholder coordination significantly enhances grid stability and efficiency.

Key findings include the need for:

• Enhanced TSO-DSO coordination
• Investment in advanced grid technologies
• Improved market mechanisms for flexibility
• Clear regulatory frameworks
• Stakeholder engagement
• Continuous knowledge exchange

The paper discusses three key topics in detail:

• Market-Based Flexibility Procurement by DSOs
• Supporting Grid Tools for Active System Management
• Applicability of Flexibility Mechanisms and their trade-off with Investments

The discussion paper raised several challenges and proposed different solutions to overcome these challenges.

Illustration of the main challenges for market-based flexibility procurement by DSOs considering the participation of demand-side flexibility

Overall, the paper concludes that the challenge of integrating flexibility in the DSO sphere is complex, necessitating additional guidance and research on how to correctly trade-off between different flexibility mechanisms and grid investments.