Since January 2026, Germany has been implementing market-based procurement of instantaneous reserve capacity. This means that, in principle, battery storage systems and renewable energy plants can also participate in the provision of this system service, provided they meet the technical and contractual requirements.
Definition of terms
Instantaneous reserve stabilizes the grid frequency immediately after a sudden active power imbalance. In synchronous machines, it is physically generated by rotating masses; grid-forming inverters can provide a corresponding response through control mechanisms.
Legal Background
The legal basis is Section 12h of the Energy Industry Act (EnWG) in conjunction with Federal Network Agency Regulation BK6-23-010 dated April 22, 2025. It requires the four German transmission system operators to procure this non-frequency-based system service in a transparent, non-discriminatory, and market-based manner. The procurement mechanism is initially valid through the end of 2031.
Why Instantaneous Reserve Will Be Procured on the Market in the Future
Historically, instantaneous reserve capacity was provided exclusively by the rotating masses of conventional power plants—an inherent physical effect that, until now, has not been compensated for separately. However, as the share of renewable energy grows and conventional, rotating generation declines, the grid’s naturally occurring inertia decreases. Market-based procurement is intended to tap into additional potential in a targeted manner before corresponding requirements are mandated in technical connection rules.
Technical Requirements
To participate in the new market, systems must have so-called grid-forming capabilities, as described in the VDE-FNN guideline “Grid-Forming Capabilities.” Unlike traditional, grid-following inverters, grid-forming systems can independently set voltage and frequency and thus technically provide instantaneous reserve capacity. It is also possible to combine several smaller systems into a single network.
Compensation Model
Compensation is based on the selected product—Basic or Premium—as well as on the actual availability of the respective unit. Germany is thus the first country in continental Europe to introduce such a market-based standard for instantaneous reserve.
Relevance for Storage Operators
For operators of battery storage systems, the new market opens up an additional source of revenue, provided the system is equipped with the necessary grid-supporting technology. Since the market will still be in its early stages in 2026, operators with appropriately equipped systems can benefit from a competitive environment that is still relatively manageable.
Distinction from related terms
Not to be confused with:
- Black-start capability: also a non-frequency-based, market-based system service, but it pertains to restoring the grid after a complete blackout rather than ongoing grid stabilization
- Primary control power (PRL): responds to frequency deviations within seconds, but with a time lag compared to the immediate instantaneous reserve
- Control energy: an overarching concept for frequency-based system services, whereas instantaneous reserve is procured on a non-frequency-based basis
Summary
With the market-based procurement of instantaneous reserve capacity, battery storage systems and renewable energy plants will, for the first time, be able to actively contribute to grid stability and receive compensation for doing so starting in January 2026. For storage operators with the appropriate equipment, this creates a new, still-emerging source of revenue alongside established markets such as balancing energy and intraday trading.
