Faculty of Science, Technology and Medicine
Faculty of Law, Economics and Finance
Faculty of Humanities, Education and Social Sciences
Interdisciplinary Centre for Security, Reliability and Trust
Luxembourg Centre for Systems Biomedicine
Luxembourg Centre for Contemporary and Digital History
Luxembourg Centre for European Law
Luxembourg Centre for Socio-Environmental Systems
The electricity grid of the future will increasingly rely on flexibility, allowing electricity demand to respond to periods of abundant renewable energy from wind and solar generation. New research shows that Luxembourg manufacturers could reduce their energy costs by adopting a hybrid approach to electrification. By combining existing industrial equipment with new electric technologies and participating in electricity markets with flexible pricing, companies could see a potential energy savings of six percent.
As companies across Europe grapple with volatile energy costs and the push to achieve the EU’s 2030 climate targets, , the Vlog’s Interdisciplinary Centre for Security, Reliability and Trust (SnT), and the Luxembourg Institute of Science and Technology () launched the in 2022 to determine the flexibility of Luxembourg’s energy landscape. The project brought together 15 researchers and experts across the three organisations to explore how households and industry can help build a smarter, more resilient electricity system.
The results, recently published, show that industrial flexibility is becoming a practical business opportunity. Companies that progressively electrify suitable manufacturing processes and participate in balancing markets could reduce their energy costs by up to six percent, while also supporting a more resilient electricity grid.
However, those businesses that only adapt to day-ahead price volatility, without offering flexibility to transmission system operators, would obtain savings of only 0.3 percent. This underlines the importance of fully exploiting the available flexibility.
The timing is particularly significant. Electricity balancing markets are the key to the potential energy saving, and since January 2025, Luxembourgish manufacturers that qualify can now participate in such markets, via . The market now open to Luxembourgish manufacturers includes the energy market that FlexBeAn research identified as offering the strongest business case for industrial flexibility (automatic Frequency Restoration Reserve (aFRR) markets).
Going hybrid first, full electric later
As their real-world use case the research team focused on industries that use gas boilers for steam generation and have the potential to switch to electric. This transition represents a significant investment in new equipment, so the researchers tested a hybrid mode of operation using both gas and electric boilers that would be used interchangeably depending on the costs of electricity, as well as participating in balancing markets. The results of the research indicate that industry could see up to six percent in potential energy savings, while allowing manufacturers to transition equipment gradually.
Looking ahead
“Our research showed that participating in flexible markets is just as important as electrification of the equipment. This finding transforms the changes needed from a business risk into a way for Luxembourgish industrial players to maintain competitiveness, allowing them to keep operations here,” said Prof Gilbert Fridgen, PayPal-FNR PEARL Chair and principal investigator on the project from SnT. “We used boilers as the real-world case for our study, but we have every reason to think that the findings are universal across many different types of manufacturing such as heating and cooling systems. We would strongly encourage all manufacturing sectors to begin assessing what the results would mean for their business.”
“Our collaboration allowed us to examine the future energy system from both technical and human perspectives,” said , lead engineer at LIST, which explored the household customer side of the coming electrical grid flexibility. “Technology alone will not deliver the energy transition. Success also depends on how people and organisations understand, adopt and use these new opportunities.”
According to Creos, flexibility will be essential to the electricity system of the future. These findings show that Luxembourg industry plays an important role in this transition.
