Impact of Economic Incentives in the Power System on Small Companies

In the ongoing transition towards increased electrification and a higher share of variable renewable electricity production, the Nordic power system is facing growing challenges related to power balance and frequency stability. Traditionally, flexibility and frequency control have been provided by large generation units. However, small and medium-sized companies are increasingly recognized as a potential source of demand-side flexibility. The economic value of such flexibility depends on how different economic incentives, tariff structures, and market mechanisms interact. This study investigates how flexible electricity consumption in a commercial facility can be used to reduce total electricity costs and create additional revenue opportunities under current Swedish market conditions. The…