EIFlexi: Those who can combine all synergies will succeed in flexibility aggregation

Having assessed the initial experience with ALPACA, in the second part of the interview we focus on where the balancing services (SVR) market is heading next. We discuss expected price developments, the arrival of new battery energy storage systems (BESS), and how the role of flexibility aggregators is changing. We now bring you the second part of our interview with Matěj Hrubý, Senior Project Manager at EIFlexi.

It is clear that activity in the balancing services market is currently very dynamic. What further price developments do you expect?

Downward pressure on prices will continue. ČEPS’ demand will remain unchanged in the long term at 960 MW, equivalent to the capacity of one Temelín unit net of its own consumption. On the other hand, supply will increase. A substantial number of battery storage facilities will be added.

Current known plans amount to several gigawatts of installed capacity. We are by no means expecting all of them to be commissioned. Even so, we are probably talking about more than 1,000 megawatts of capacity. The question will then be timing. However, it is already clear that projects will face delays.

Even investors outside the energy sector now know the acronym aFRR. But when ČEPS procures 200 MW of aFRR capacity in the day-ahead market, it is evident that not everyone can, or will, provide aFRR.

Germany offers a degree of optimism, as balancing service prices there have not been falling at all. For aFRR, the 2024 average was around 13 EUR/MW/h. For the first eight months of 2025, it was more than 15 EUR. We expect prices in Czechia to gradually fall to a level where revenues from balancing services are comparable to revenues from trading arbitrage. Once trading arbitrage becomes more economically attractive for battery systems, it will no longer make sense for them to remain in the balancing services market.

This is why we are focusing on trading arbitrage: deploying batteries in the day-ahead and intraday markets. Put simply, it means buying electricity cheaply and selling it at a higher price. In reality, however, it involves complex optimisation across markets and time horizons.

How will the operation of an aggregator change with the arrival of battery systems?

We at EIFlexi jokingly say that as long as we operate assets more for balancing services than for trading arbitrage, we are more of an activator than an aggregator. From an operational perspective, it is not complicated yet. There is little pressure on control systems and software. However, this will fundamentally change as battery systems become more widely integrated. Everything will have to be automated, supported by AI, and linked to algorithmic trading. We are ready for that.

To put it in practical terms, on a daily basis the system will gradually submit bids based on electricity price forecasts: into FCR (deadline at 8:00), aFRR (9:00), and mFRR (10:00). Then comes the day-ahead market (12:00). All of this takes place on the day-ahead basis. During the actual day, optimisation will then take place in the intraday market.

Flexibility aggregators have been receiving a great deal of attention lately, and it seems to me that their number is growing rapidly. What can we expect in this area—will this trend continue?

There are currently around 30 aggregators operating in the Czech market. They include large, established electricity traders as well as smaller entities aggregating just a few megawatts. Each has its own specific characteristics.

Large traders use this to retain their existing customers, but are held back by internal processes. Smaller players, by contrast, are more flexible, but face a lack of funding or high-quality software. We consider ourselves a larger aggregator in this respect: our dispatch centre manages more than 100 MW, with further assets to be added by the end of the year.

In the long term, we believe such a number of aggregators is unsustainable. Falling revenues from balancing services will mean lower turnover, while pressure on software and know-how will increase. Succeeding will become increasingly difficult. Portfolios will be resold, and so-called aggregators of aggregators will emerge on the market.

Those who can combine all the synergies will succeed: sufficient capital, know-how, reliable dispatching, high-quality IT, and the support of a strong electricity trader capable of handling imbalances and deliveries.