Power system’s operational flexibility represents its ability to respond to predicted or unexpected changes in generation and demand. Traditional policy and planning models usually do not consider the technical operating constraints directly responsible for its operational flexibility. Nevertheless, this capability becomes increasingly important with the integration of significant shares of renewables. Incorporating flexibility can significantly change optimal generation strategies, lower the total system costs and improve policy impact estimates. The goal of this research is to prove that, for computational efficiency reasons, it is useful to cluster some of the original units into larger ones. This process reduces the number of continuous and binary variables and can, in certain conditions, be performed without significant loss of accuracy. To this purpose the Dispa-SET unit commitment and power dispatch model which focuses on balancing and flexibility problems in the European grids has been applied to the Western Balkans power system. Various clustering methods are implemented and tested on the same dataset and validated against the “No clustering” formulation. “Per unit” aggregates very small or very flexible units into larger ones with averaged characteristics, ”Per typical unit” considers one typical power plant per technology; and ”Per technology” additionally simplifies the mathematical formulation by completely neglecting units flexibility capabilities. The results have shown that the difference between disaggregated and clustered approaches remains acceptable and for certain accuracy metrics falls within a 2% margin. This is especially true in case of highly interconnected regional systems with relatively high shares of hydro energy.