Taxonomy to Quantify Flexibility Potential

This factsheet presents a structured framework for identifying and quantifying flexibility potential within modern power systems. It highlights the growing importance of flexibility as electricity systems integrate higher shares of renewable energy, distributed resources, and digital technologies. The document defines flexibility as the ability of the power system to manage variability and uncertainty in supply and demand while maintaining reliability and cost efficiency. The publication introduces a taxonomy consisting of four key layers—technology or process, communication and controls, location, and customer preferences and market economics—which together determine the feasible flexibility potential of a resource. As illustrated in the diagram on page 4, these layers progressively refine the theoretical maximum flexibility into what can realistically be delivered in practice. The document also provides a set of qualitative and quantitative indicators to support the assessment of flexibility across different system segments. Overall, the factsheet offers a practical tool for system operators, planners, and policymakers to better understand, evaluate, and leverage flexibility resources, supporting more efficient grid operation and the transition towards net-zero energy systems. This publication was prepared for the International Smart Grid Action Network (ISGAN) by its Working Group 9. ISGAN is organized as the Implementing Agreement for a Co-operative Programme on Smart Grids (ISGAN) and operates under a framework created by the International Energy Agency (IEA). The views, findings and opinions expressed herein do not necessarily state or reflect those of any of ISGAN’s participants, any of their sponsoring governments or organizations, the IEA Secretariat, or any of its member countries.