The initial plan called for Barry Allen, played by Grant Gustin, to be introduced in Episodes 8 and 9 of Season 2 of Arrow and for Barry Allen to make his debut as The Flash in Episode 20 of Arrow. Episodes 8 and 9 of Arrow have already been shot, so they will still serve as the introduction of Barry Allen. However, The CW has now opted to film a standalone pilot for the introduction of The Flash rather than introducing him in Episode 20 of Arrow.
The reason for the change is that reportedly The CW executives were very impressed with cuts of Episodes 8 and 9, so they felt confident enough to take the next step and go straight to a standalone pilot. The creative team for The Flash pilot will be Arrow co-creators Greg Berlanti and Andrew Kreisberg, writer Geoff Johns, and director David Nutter. Berlanti, Kreisberg and Nutter will executive produce with Melissa Kellner Berman co-executive producing.
It's unclear whether Episode 20 of Arrow will still include The Flash in some form or fashion or not.