## 1 Introduction
To address this, new market mechanisms are being introduced to reward flexibility and encourage participation from smaller players, including households [25]. Time-of-use tariffs, for instance, incentivize consumers to shift their energy usage to off-peak hours when electricity is cheaper and more abundant, aligning household consumption with renewable generation patterns [26]. Furthermore, virtual power plants (VPPs) represent a promising solution for aggregating residential flexibility. A VPP combines multiple households' energy production, storage, and consumption capabilities into a single, controllable entity that can participate in electricity markets like a traditional power plant. By leveraging advanced algorithms and real-time data, VPPs can respond dynamically to grid conditions, providing frequency regulation, peak shaving, and energy arbitrage services [27]. The electrification of heating and cooling systems is another critical aspect of the energy transition. Traditional fossil fuel-based systems are being replaced with electric alternatives like heat pumps and electric water heaters, which can be integrated into demand response programs [28]. These systems are particularly effective when paired with thermal storage solutions, such as water tanks or phase change materials. This allows energy to be stored during periods of low demand and used later when needed. This approach minimizes the impact of renewable intermittency on household comfort levels [29]. In parallel, advancements in battery technology are making residential energy storage more viable and cost-effective. Lithium-ion batteries, the current industry standard, are rapidly decreasing in price while improving in capacity and efficiency [30]. These batteries enable households to store excess solar or wind energy for later use, reducing their reliance on the grid and enhancing their resilience to power outages. Future developments in solid state and flow batteries could further expand the potential of residential energy storage, offering longer lifespans and greater scalability. Additionally, the role of community-based energy initiatives cannot be underestimated. Energy cooperatives and shared renewable projects enable groups of households to collectively invest in and benefit from renewable energy systems [31]. These initiatives promote social cohesion while distributing the financial and operational risks associated with energy projects. Community solar farms, for example, allow residents without suitable rooftops to participate in the solar revolution, broadening access to renewable energy benefits. Policy support will continue to play a pivotal role in enabling residential flexibility and renewable integration. Regulatory frameworks must evolve to accommodate the unique characteristics of decentralized energy systems [32]. This includes streamlining permitting processes for residential solar and storage installations, implementing feed-in tariffs to reward surplus energy fed back into the grid, and establishing minimum energy efficiency standards for appliances and buildings. Policies that prioritize equity, ensuring that low income and marginalized communities are not left behind, are particularly important for achieving a just transition. International collaboration is also critical for addressing the global challenge of climate change. The sharing of best practices, technologies, and lessons learned among countries can accelerate the deployment of effective solutions. For example, nations with high renewable penetration, such as Denmark and Germany, have demonstrated the feasibility of integrating large amounts of wind and solar power into their grids [33]. These experiences provide valuable insights for other countries embarking on similar paths. Looking to the future, the convergence of renewable energy, digital technology, and advanced analytics holds immense potential for transforming the residential energy landscape [34].