The UK flexibility market continues to grow, with 9GW contracted in 2024. New regulations and digital infrastructure are coming into play to support the National Energy System Operator’s target of 12GW consumer-led flexibility by 2030. So, here are five key developments shaping UK flexibility and its flex markets for 2026.
This blog covers:
- MHHS migration gathers pace as new dashboard tracks supplier progress
- Demand Flexibility Service expands to include two-way flexibility for the first time
- Elexon steps in as market facilitator and publishes its 2026–28 delivery plan
- Digital infrastructure accelerates flexibility market integration
- Day-ahead and real-time trials demonstrate flexibility’s growing role in network management
1. MHHS migration gathers pace as new dashboard tracks supplier progress
Market-Wide Half-Hourly Settlement (MHHS) is moving Great Britain’s electricity system from estimated billing to settlement based on actual half-hourly consumption data.
In 2026, Elexon launched a dashboard tracking supplier migration progress, giving a transparent view of how the transition is advancing.
The leading large supplier is approaching the halfway point of its migration, showing that the transition is now well underway.
Ofgem’s approval of BSC Modification P483 in August 2025 helped accelerate this progress. The modification removed the half-hourly settlement requirement for aggregators to trade domestic flexibility.
This allowed Virtual Lead Parties to access around 345,000 households and small businesses previously excluded from UK flexibility markets.
The change helps position end-consumers at the forefront of grid balancing strategies, with aggregators transforming millions of previously inaccessible assets into flexible resources that can participate in wholesale markets.
MHHS milestones
- Nearly 20.2 million meters have already transitioned as of August 2026
- The programme remains on track for 80% of meters migrated by October 2026
- Full migration is due by May 2027, with cutover to the new settlement timetable planned on 2 July 2027
2. Demand Flexibility Service expands to include two-way flexibility for the first time
The Demand Flexibility Service (DFS) gives homes and businesses a simple way to participate in the electricity market and get rewarded for shifting when they use power. Its year-round operation enables flexibility providers to optimise asset utilisation across multiple revenue streams whilst helping NESO balance the grid continuously.
DFS works through retailers, who invite customers to change their electricity consumption, depending on what the system needs.
Since March 2026, DFS offers bi-directional flexibility for the first time. That means that participants can get rewarded for reducing their use during peak times, but also consuming more electricity when low-carbon energy is available.
Plus, the eligibility threshold has dropped from 1MW to 0.1MW, opening up participation for smaller suppliers and businesses.
DFS milestones
- Winter 2022/23: DFS launched as a seasonal emergency tool to reduce peak demand
- November 2024: DFS became a year-round, in-merit margin tool
- As of March 2026, over 2.46 million businesses and consumers have signed up
- 9 April 2026: Bi-directional flexibility, zonal procurement, and the 0.1MW threshold reduction went live
- From October 2027, NESO will introduce constraint management actions and fully transition Local Constraint Management (LCM) into DFS
3. Elexon steps in as market facilitator and publishes its delivery plan
The UK is advanced in its use of flexibility markets, yet participation across multiple flexibility markets can be complex. This creates barriers for service providers and can reduce the volumes available in each market.
In December 2025, Elexon officially became the market facilitator, tasked with coordinating and aligning these markets so participants can interact more easily with both local and national grid operators.
Its delivery plan, running to March 2028 and revised in July 2026 following feedback through its Stakeholder Advisory Board, builds on the Open Networks programme’s earlier standardisation work.
Its next priorities span a common dispatch API, a unified market data portal, a long-term coordination roadmap, standardised market definitions for revenue stacking, and a single asset registration system (FMAR).
Elexon market facilitator milestones
- December 2025: Elexon began market facilitator operations, coordinating more than 20 local and national flexibility markets
- January 2026: Delivery plan published, covering the period to March 2028
- July 2026: Delivery plan updated
- 2026–28: Key workstreams underway as outlined in the delivery plan
4. Digital infrastructure accelerates flexibility market integration
Two standardisation initiatives advanced in 2025 to unlock flexibility at scale. The Data Sharing Infrastructure, now in pilot development with NESO’s Virtual Energy System programme, eliminates the need for separate data agreements with each market operator – currently a major barrier requiring extensive manual workarounds that limit participation to sophisticated flexibility service providers (FSPs).
The Flexibility Markets Unlocked programme is another standardisation project, delivering Flexify, a web-based platform improving UK flexibility market access. This sits alongside Flexibility Data Standards – to enhance transparency and interoperability for data exchange – and the Market Rules Test Bed to assess the impact of market rules within the flex ecosystem.
Government-backed initiatives like these address the core challenge facing local flexibility markets in the UK: reducing the complexity and cost of participating across multiple platforms and protocols.
These initiatives signal an important shift for utilities operating flexibility platforms. Distribution system operators (DSOs) embracing open standards will find it easier to attract participants and achieve market liquidity.
5. Day-ahead and real-time trials demonstrate flexibility’s growing role in network management
Two recent trials through flexibility markets show how it continues to cement its place in network operations.
In late 2025, SP Electricity North West became one of the first DSOs to dispatch flexibility in real time through ElectronConnect. A fleet of Axle Energy assets responded to a dispatch instruction within 15 minutes, and adjusted electricity output to relieve local grid constraints. This functionality enables grid operators to manage network constraints based on actual network data rather than forecasts.
Moving into 2026, SSEN and Electron completed a live trial using day-ahead markets to reduce the risk of outages during planned maintenance works in Maidenhead. Configured and launched within a week, SSEN procured flexibility at short notice to support customer supplies during those essential works.
Both trials point to how flexibility is becoming more responsive and embedded in how networks are run day to day.
Looking ahead
The developments in 2025 and 2026 show what’s in progress to support the government’s Clean Power 2030 ambitions.
NESO and Ofgem’s Clean Flexibility Roadmap, published in July 2025, estimates total flexibility capacity will reach 55.2 gigawatts by 2030 and 204 gigawatts by 2050.
NESO has already set a minimum ambition to deliver an additional 750MW of industrial and commercial flexibility through its markets by 2030.
The challenge now is maintaining that momentum as market platforms scale to accommodate the millions of flexible assets needed for the energy transition.
Read more
6 energy flexibility trends and updates from the European Union (EU) for 2026
Here’s an overview of some of the trends affecting how that flexibility will develop in the EU in 2026.
A guide to flexibility services for UK providers
What FSPs need to know about participating in UK flexibility markets.
Your guide to flexibility market types and how they work
Here’s an overview of the key flexibility market types and the network challenges they help address.
