Abstract for: Business dynamics of flexibility aggregators: Managing prosumer participation and steering clear of being “too small to bid"

Flexibility aggregators bundle decentral generation and storage units to balance supply and demand in the electricity market. With their business model, they access a so far unexploited potential for flexibility. While the concept of flexibility aggregation is well known, the business strategies to successfully launch and manage a flexibility pool remain largely uninvestigated. Here, we test business strategies for aggregators of decentral flexibility to manage the revenue streams, delivery configuration and customer value of a flexibility aggregation business. Taking the battery swarm as a case study, we develop a novel simulation model that captures actor-specific decisions by prosumers and aggregators, combining market and empirical customer preference data. Our study provides insights that are particularly relevant for practitioners that seek for promising approaches (1) to spur customer participation for a flexibility aggregation offer, and (2) to overcome the financing gap that is threatening during the take-off phase of an aggregator business.