2.6. Assumptions on balancing reserves

Balancing reserves are contracted with certain producers and consumers to increase or decrease generation or demand at certain sites to ensure an efficient, secure and reliable grid. Using those reserves, the TSO can restore the balance between generation and demand. Such imbalances can be caused for example by the unforeseen loss of a production unit, renewable infeed fluctuations or demand forecasting errors. Therefore, these kinds of reserves need to be available at all times in order to restore the balance. The market tool used in this study simulates the hourly European market assuming a perfect foresight of demand and RES with an hourly step. As it must be possible to deploy the balancing reserves to restore deviations in real time, independently from the market output, the volume contracted from generation units for frequency containment and restoration reserves is taken into account in the simulations as a reduction in available capacity. The assumptions on the quantity of balancing reserves for all countries are taken from the ‘Mid-term Adequacy Forecast’ (MAF) Study performed at ENTSO-E level for 2025. The same amounts are considered in all scenarios and time horizons, despite the fact that due to the increase of RES, more deviations could be observed. It is assumed that other flexible options will be available to balance the system (increased amount of demand response, storage...). More detailed analyses should be performed in the future to quantify the need for such flexibility more accurately. For Belgium it was assumed that 500 MW of balancing reserves were provided by thermal generation units and pumped-storage. Therefore, a derating of 500 MW of the thermal and pumped-storage capacity was considered. This capacity cannot be dispatched for economic reasons as it should be kept for balancing purposes. The additional balancing needs (on top of the 500 MW) are considered to be demand response and storage facilities not taken into account in the assumptions as capacity that is modelled in the market.