March 18, 2025
Balancing services: aFRR - Crucial for a stable power grid
What is aFRR?
How does aFRR work?
When a 50 Hz deviation cannot be restored by FCR, aFRR is automatically activated via a signal from TenneT. This signal is transmitted to market participants such as Covolt, who adjust their power. This process takes place within minutes and helps to stabilize the grid quickly without manual intervention (mFRR).
FCR vs. aFRR vs. mFRR — what's the difference?
The Dutch balancing market has three main mechanisms, each of which is deployed at a different time and at a different rate:
- FCR (Frequency Containment Reserve) — the first line of defense. It responds automatically and within seconds to any deviation in the grid frequency.
- aFRR (Automatic Frequency Restoration Reserve) — is used when FCR is insufficient. Fully automated, with a response time of a few minutes after receiving a signal from TenneT.
- mFRR (Manual Frequency Restoration Reserve) — the third layer, and as the name suggests, manually activated by an operator in the event of a larger or more prolonged imbalance.
Covolt is qualified to provide aFRR and, where possible, combines this with other services such as curtailment and imbalance trading to maximize returns.
| Characteristic | aFRR | mFRR |
|---|---|---|
| Activation | Automatic Activation for Frequency Recovery | Manual activation by TenneT |
| Response time | ✓ Within 30 seconds | Within 12.5 minutes |
| Insert | Frequent minor adjustments to the power grid | Significant or prolonged imbalances |
| Reimbursement | Capacity Compensation and Energy Compensation | Capacity Compensation and Energy Compensation |
| Can be combined | Can be combined with mFRR, imbalance trading, and day-ahead optimization | Can be combined with aFRR, imbalance trading, and day-ahead optimization |
Covolt manages certified pools for both aFRR and mFRR. Batteries participating through Covolt are automatically deployed to the most profitable service, day and night.
aFRR with a battery
A battery is ideally suited for aFRR supply. Whereas solar panels depend on sunlight, a battery can rapidly supply or draw power at virtually any time—exactly the capability that TenneT requires during an aFRR activation. Covolt manages a qualified aFRR pool and automatically controls the battery based on signals from TenneT, without compromising your own consumption or other applications such as peak shaving. This allows you to get extra value from power that would otherwise remain unused.
Why is aFRR important?
- Power grid reliability - Without effective balancing mechanisms, frequency fluctuations can lead to outages and even blackouts.
- Efficiency - aFRR provides faster and more efficient grid stabilization than manual corrections.
- Integration of renewable energy - With the growth of wind and solar power, energy production is becoming more volatile. aFRR helps to accommodate these fluctuations without relying on fossil backup power plants.
How do you make money with aFRR?
- Compensation for availability - Covolt ensures that your solar power is flexibly available to the grid. You will receive compensation for this, even if your power is not being used.
- Compensation for activation - When the grid needs extra power or needs to shut down, your energy is put to use. For this, you get an extra reward.
- Smart trading and optimization - Covolt uses smart algorithms to best trade your renewable generated and maximize yield.
- Impact on imbalance prices – aFRR helps keep the grid stable. This affects imbalance prices, which in turn affects your revenue.
PICASSO platform and international cooperation
Since October 18, 2024, TenneT has been connected to the PICASSO platform. This platform makes it possible to exchange control power with other connected countries, such as Germany and Denmark. TenneT activates foreign bids if they are cheaper than national aFRR options.
Connection to PICASSO helps to reduce strong grid fluctuations, especially due to extremely low electricity prices. In the past, this created "regulation status 2," where correction mechanisms failed and parties in the imbalance market were unable to generate revenue. As a result of PICASSO, TenneT expects fewer control status 2 situations.
Dutch aFRR prices have historically been lower than international aFRR prices, so joining PICASSO has a positive effect on the returns of Dutch market participants active in free aFRR bids.
Future of aFRR in the Netherlands
With the growth of Battery Energy Storage Systems (BESS), aFRR is becoming increasingly important and broadly applicable. Battery control significantly increases grid flexibility. In addition, the aFRR market is becoming more accessible to smaller players, resulting in more providers. This can lead to lower prices and revenues, as in any competitive market.
However, the energy market remains dynamic, and aFRR is just one of many changes that will shape the future of the power grid.
Read more
Imbalance Management: What Is It, and How Does Covolt Do It?
aFRR and imbalance trading go hand in hand. Olaf Ketelaars explains how Covolt manages its operations on a daily basis based on the imbalance price.
Olaf Ketelaars
Covolt
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