From Regulation to Market Development: The Role of the EU Network Code on Demand Response in Shaping European Flexibility Markets
Y. Wang (TU Delft - Technology, Policy and Management)
Ö. Okur – Mentor (TU Delft - Technology, Policy and Management)
L.M. Kamp – Graduation committee member (TU Delft - Technology, Policy and Management)
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Abstract
The forthcoming EU Network Code on Demand Response (NCDR) aims to provide a common regulatory basis for demand-side flexibility across Europe. However, national flexibility market arrangements have developed differently, raising questions about how existing markets align with the NCDR and what this alignment implies for flexibility market development. This thesis addresses this issue through a comparative case study of France and the Netherlands.
The research first translates relevant NCDR requirements into an assessment framework covering procurement mechanisms, market coordination, baseline methodology, and system-operator coordination. This framework is then applied to the French and Dutch flexibility market arrangements using regulatory and market documents, supported by expert interviews.
The results show that both cases already align with many NCDR requirements, although important gaps remain. France mainly requires stronger integration and formalisation of coordination arrangements, while the Netherlands mainly requires further formalisation and completion of existing practices, particularly in baseline methodology and coordination processes. The comparison suggests that the NCDR promotes functional harmonisation without imposing a single market architecture. In mature markets, implementation is therefore more likely to involve adaptation of existing arrangements than market creation. At the same time, regulatory alignment alone cannot ensure market liquidity, predictable revenues, or commercially viable participation. These findings emphasise both the role and the limits of the NCDR in shaping the development of European flexibility markets.