NESO announces shakeup to new look Demand Flexibility Service

25 March
Press release Balancing services 25 Mar 2026
Person working in warehouse

Key facts
NESO confirms evolution in design for the Demand Flexibility Service following approval by Ofgem.
The Demand Flexibility Service will continue to operate as a year-round merit based margin tool.
For the first time will allow consumers and businesses to participate in the service by increasing their electricity following instructions from NESO and their energy supplier.
The service will continue to also allow consumers to participate by shifting their electricity use out of peak times, potentially enabling consumers and businesses to participate multiple times in a single day.
Consumer households and businesses can sign up to take part in the Demand Flexibility Service via Providers, such as household energy suppliers, aggregators and other third parties in order to earn pounds, points or prizes.
To date over 2.46million businesses and consumers have signed up to use the Demand Flexibility Service.

Today (25 March 2026) Ofgem has confirmed its approval of an evolved service design for the Demand Flexibility Service run by NESO. This evolved design will enable key changes to the service to support its continued year-round usage and to unlock new opportunities for businesses and consumers participating in the service via their energy supplier or third-party aggregator.

For the first time NESO’s service will enable participating consumers and businesses to be rewarded by their energy supplier or third-party aggregator for increasing their electricity use at certain times, to take advantage of the availability of excess electricity supplies. 

This change will enable consumers to take part at more times throughout the day, as they could now be asked to increase their electricity use at one point in the day, and to shift their electricity use outside of key times at a latter period in the day.

To support the energy suppliers and third-party aggregators who participate in this service, NESO has also introduced a number of improvements which will further grow the service. Most notably NESO has reduced the previous 1MW minimum size threshold to 0.1MW, making it possible for smaller energy suppliers and other businesses to participate directly with NESO. 

Alongside NESO’s work with energy suppliers to support the new options available to consumers, NESO has also been working closely with the industrial and commercial community to support the ambitions of the Clean Flexibility Roadmap. Businesses interested in engaging in demand side flexibility can now receive 1:1 support from NESO’s Power Responsive team, to enable their participation in the Demand Flexibility Service and NESO’s wider flexibility services.

Following approval from Ofgem this morning, NESO will look to bring the design changes to life in the coming weeks and will be working with businesses and energy suppliers to promote the new options available through the service.

Rebecca Beresford, Director of Markets, NESO: 

“There are certain times when the GB system is fortunate to have plentiful supplies of low carbon electricity.  Enabling consumers to benefit by increasing their electricity use at those times is a critical step to making demand side flexibility work for consumers and the system. 

Our evolved service design will maximise the value for consumers and businesses looking to participate in flexibility. We are excited to see participation continue to grow and build on the success of the Demand Flexibility Service to date.”

ENDS
About NESO

National Energy System Operator, NESO, is an independent, public corporation at the centre of the energy system taking a whole system view to help ensure everyone in Great Britain has access to reliable, clean, and affordable energy.
For media enquiries please contact:

E:  [email protected]

M: 07866 897151

Notes to editors:

DFS History

  • Due to the risks and uncertainties for winter 2022/23, NESO (then operating as National Grid ESO) developed the Demand Flexibility Service as part of a package of winter contingency options to ensure it was well prepared to maintain safe and secure operation of the electricity system.
  • Based on the success and value of the Demand Flexibility Service it was used across the 2022/23, 2023/24 winters, before evolving in 2024 to become a year round service, that has been used on a consistent basis ever since.
  • Since its establishment in 2024 as a merit based margin tool, the Demand Flexibility Service has delivered over 12,000MWh, with over 2.46million businesses and consumers signed up to take part.

How DFS works

  • The Demand Flexibility Service works with Providers (energy suppliers, aggregators and commercial businesses) to bring together consumer households alongside businesses to deliver electricity demand increase and/or reductions.
  • Payments are made directly to Providers by NESO. How providers incentivise their customers to participate is decided by each individual provider.

The Evolved Demand Flexibility Service

  • Companies interested in acting as service providers, such as energy suppliers and third-party aggregators, should reach out to NESO.
  • The updated Demand Flexibility Service will be available for use by NESO's control room from the 14th April.