Energy systems integration involves the co-ordinated design, implementation, operation, planning and adaptation of energy systems with the objective of delivering reliable, safe, cost-effective energy services with minimal environmental impact.1 Here, it is addressed with a specific focus on the integration of higher levels of renewable energy in power grids, heating and cooling systems, and transport fuelling systems.

Renewable energy can lead to more sustainable and economical operation of energy systems.2 However, as shares of renewable energy grow, the systems that have evolved or been designed around conventionali energy sources require adaptation efforts to maintain or improve the services that they deliver.3 These efforts include top-down integration measures such as the planning and design of infrastructure, markets and regulatory frameworks, as well as the bottom-up development and advancement of supply- and demand-side technologies. To this end, governments, regulators, energy utilities, technology companies and energy consumers have been addressing barriers that may slow or halt the growth of renewables, working to expand existing end-uses of renewables, and creating new markets for renewable energy technologies and services.4

In the power sector in particular, rapid growth in the installed capacity and penetration of variable renewable electricity (VRE) sources – such as solar photovoltaic (PV) and wind power – has occurred in many countries.5 VRE achieved unprecedented penetration levels during 2020 due to cost reductions and subsequent demand.6 In addition, COVID-19 containment measures that depressed electricity demand resulted in increased VRE shares due to preferential dispatch protocols and marginal cost advantages.7

Several power systems reached record-high instantaneous VRE shares in 2020, forcing grid operators to apply a range of new and existing measures to ensure ongoing service.8 Some power systems, for example in South Australia, reached such high VRE penetration levels that electricity supply routinely exceeded demand.9 During the year, consumption of electricity from renewable sources surpassed that from coal in the United States for the first time in 130 years, while the United Kingdom’s power system operated without coal power for 18 consecutive days – the longest period in nearly 140 years.10

At the end of 2020, renewables represented around 29% of global electricity generation, and more than 9% of the total generation was estimated to be from solar PV and wind power.11 The penetration of modern renewables in transport and in the heating and cooling sector was much lower than this. ( See Global Overview chapter.) Many examples of renewables integration in 2020 occurred in the power sector (or involved the electrification of end-uses in other sectors), particularly in countries and regions with supportive policy environments or energy markets such as Australia, China, Europe and North America. ( See Policy Landscape chapter.)

Power systems are adapting to higher shares of generation capacity based on power inverters, such as

wind and solar.

In recent years, the growing shares of variable energy resources that require the use of power invertersii, and the corresponding decentralisation of power systems, have created new requirements for control and monitoring systems.12 These shifts in turn have prompted the wider digitalisation of transmission and distribution grids, and of downstream or “behind-the-meter” systems that incorporate electricity generation, storage and demand.13 As power grids continue to evolve, numerous examples have emerged of the digitalisation of key operating nodes (such as control rooms and sub-stations) in order to more effectively process and manage more complex flows of information.14 Advanced digital technologies including artificial intelligence and machine learning have been applied to improve the accuracy of both generation and demand forecasting, and to enable the aggregation of distributed energy resourcesiii to improve power system flexibility.15

Several technologies have supported the integration of renewables by enabling greater flexibility in energy systems or by promoting the linking of energy supply and demand across electricity, thermal and transport applications. Among the more mature or commercialised enabling technologies are heat pumps, electric vehicles (EVs) and certain types of energy storage, such as batteries. Other technologies that were still emerging during 2020 but that may help to reach higher shares of renewables in all sectors include renewable hydrogen, non-lithium-ion batteries (such as flow batteries) and novel forms of mechanical storage.


iThe word “conventional” is used here to describe non-renewable energy resources or large hydropower. In the context of the power sector, the term “conventional generators” describes fossil fuel, nuclear and large hydropower generators.i

iiTechnologies such as solar panels, wind turbines and batteries use power inverters to convert direct current (DC) into alternating current (AC) to allow them to interface with AC-based power systems. Resources that require the use of inverters do not have the rotational characteristics of conventional gas, steam or hydro generators, and impose different stability requirements on power systems as they become more prevalent.ii

iiiDistributed energy resources include generators such as solar PV and wind plants, energy storage facilities and sources of demand.iii


Competitive Wholesale Electricity Market Design

Integration of Flexibility and Ancillary Services from Sources of Supply and Demand

Advances in Forecasting of Generation and Demand

Enhanced Grid Interconnections and Grid Management Systems




Heat Pump Markets

Heat Pump Industry


Electric Vehicle Markets

Electric Vehicle Industry


Energy Storage Markets

Energy Storage Industry