This study develops a reproducible method for estimating the cost-efficient flexibility potential of a local or regional energy system. Future scenarios that achieve ambitious climate targets and estimate the cost-efficient flexibility potential of demonstration sites were defined. Flexible potentials for energy system assessment are upscaled from the demonstration sites in Eskilstuna (Sweden) and Lower Austria (Austria). For example, Eskilstuna uses the building-stock model ECCABS and the TIMESCity-heat model for upscaling, whereas Lower Austria uses the Mixed Integer Linear Programming (MILP) optimization model, the BALMORAL power system model, and the Integrated MARKAL-EFOM System energy system modeling tool.
According to the modeling, HPs will dominate Eskilstuna’s heating sector by 2040. Building rehabilitation reduces energy use in Lower Austria, where residential fossil fuel use ends in 2040. Heat pumps and district heating are critical for future heat demand. These findings are explained by the postulated technological-economic parameters, energy prices, and CO2 prices. We conclude that future electricity prices will determine future heating systems: either a high share of centralized heat pumps (low electricity prices) or a high share of combined heat-and-power (high electricity prices). Large-scale energy storage may be crucial. Furthermore, district heating companies have demand-side flexibility, but centralized flexible systems are the most cost effective.