## 1 Introduction
The length of the bidding period is country- and market-specific. When the bid size is determined, the aggregator is bound to deliver that amount of flexibility during the complete bidding period, in response to frequency deviations [13]. Many different technologies have the potential to operate as DR-assets, in the residential, commercial and industrial sectors. An example is the residential heat pump. Heat pumps convert electrical power into heat, used for heating households and supplying hot tap water, and thus, have a fundamental role in efficient energy use in residential buildings [15]. Heat pumps show large potential in abating CO\({}_{2}\) emissions, and this is accelerated by increasing shares of renewable electricity generation [16; 17]. In contrast to gas-fired boilers, heat pumps are most efficient when operating at low temperatures, and are therefore considered slow response heating systems [18]. This may be a positive aspect from the perspective of switching them on or off in a DR event. Even though it is widely recognized that heat pumps can be used as flexibility assets in DR-portfolios, their flexibility is currently only rarely utilized [19]. Most research conducted in this field of study focusses on the technical performance of heat pumps in providing flexibility [20; 21; 22]. However, no literature studies were found that investigate aggregator bidding process optimization strategies. Also, the potential financial revenues resulting from offering flexibility on the Dutch FCR market using these strategies seem largely unknown. Therefore, the scientific contribution of this work lies in:  
* Insights into the effects of potential aggregator bidding strategies that on the potential of FCR
* An assessment of the economic potential of domestic heat pumps to deliver flexibility on the FCR market. This potential is measured in revenue per household
* The development of a quantitative model to assess the potential of FCR, and an explanation of the model logic
* A detailed assessment of the effects of TSO-regulation on the potential for FCR  
This study aims to investigate the technical and economic potential for a portfolio of aggregated residential heat pumps to provide flexibility on the Dutch FCR market. Economic potential is measured by revenue generated from providing FCR, whereas technical potential is measured in terms of bid capacity given technical constraints. In addition to the technical and economic potential, the effect of fine regulations, i.e., fines for non-availability and inadequate response, is thoroughly investigated. Two strategies are considered that the aggregator can apply to determine the weekly bid size: the 'always available' strategy and the 'always reliable' strategy, both based on availability and/or reliability. Both strategies, as well as the concepts of reliability and availability, are explained in the method. In addition, an explanation is provided of how the model functions and how the results can be interpreted. The paper is structured as follows. The methodology section starts with an explanation of the TSO-regulations, bidding strategies and model details. Information is then provided regarding data processing and frequency analysis, followed by a detailed explanation and overview of the model functionalities. The results section begins with the general model results. This is followed by an analysis of reliability, availability and monetary flows, and an analysis of grid frequency. After the discussion and conclusion section, the appendix provides more details regarding the TSO fine regime and household availability.