How the benefits of flexibility need to be available to all
For Jeremy, flexibility is so easy, it’s almost an afterthought.
After investing around £10,000 in rooftop solar and battery storage, he’s now able to generate roughly 30kWh of electricity a day during the summer months. Around 20kWh can be exported back to the grid, earning between £2 and £2.50 daily through a Smart Export Guarantee tariff. Add the value of avoided electricity imports and occasional flexibility payments from an aggregator, and the total benefit can reach around £5 per day during peak season.
His setup illustrates a growing reality in the UK’s energy market. Increasing numbers of households are no longer just consuming power - they’re generating it, storing it and, increasingly, being paid to use it to meet specific grid demand requirements
The value here for those with solar, batteries and EV’s is stackable.
The first is avoided import. Every unit of electricity generated and consumed on-site is a unit that doesn’t need to be bought from the grid. Under Ofgem’s current price cap, electricity costs 26.11p/kWh, making self-consumption increasingly valuable. Alongside that sits export revenue through the Smart Export Guarantee. The third layer is flexibility income, where households are paid to charge, discharge or shift demand when the electricity system requires support.
Importantly, these revenue streams stack rather than compete. They are paid through different mechanisms, which means flexibility becomes an additional return on top of existing savings rather than a replacement for them. That matters, because delivering flexibility services is rarely the primary reason people invest in solar and storage.
Analysis from the New Economics Foundation estimates that a typical household with solar panels and a battery could save an average of around £718 annually through a combination of reduced grid imports, export earnings and time-of-use optimisation. By comparison, flexibility revenues are generally much smaller. Axle Energy, one of the UK’s largest domestic flexibility aggregators, reports average earnings of around £10 per month across more than 300,000 connected assets.
In other words, flexibility is not the main prize – but an additional revenue point on top of larger savings.
A market reaching scale
The backdrop to this debate is the well documented acceleration in rooftop solar adoption.
According to Ember, the global energy think tank, more than 2.5GW of rooftop solar was installed in both 2024 AND 2025, matching the total installed across the previous five years. What’s interesting is that this growth is happening even without the subsidies that drove the first solar boom under the original (lucrative) Feed-in Tariffs.
So, what’s driving it?
Battery costs have fallen dramatically over the past decade, alongside falling installation costs. Zero-rated VAT on domestic solar and storage has improved payback periods, and probably the biggest driver, higher retail electricity prices have increased the value of self-consumption. The result is that approximately 1.9 million UK homes now have rooftop solar installed.
At the same time, flexibility markets are expanding to fill the generation gap, well beyond their original purpose.
The Demand Flexibility Service (DFS), initially developed as an emergency mechanism during periods of tight winter supply, has evolved into a year-round balancing tool. Since April 2026, consumers are rewarded not only for reducing demand but also for increasing consumption when topping up their EV’s or batteries can help take additional generation off the grid.
The potential here is massive. National Energy System Operator (NESO) projections indicate that Britain will require between 10GW and 12GW of consumer-led flexibility by 2030. Longer term, consumers, and businesses, are expected to provide a substantial proportion of flexibility across the entire energy system, replacing the need to build additional generation.
The case for flexibility itself is clear - it reduces peak demand, lowers balancing costs, limits network reinforcement requirements and helps integrate larger volumes of renewable generation. The challenge going forward however is who gets access to the rewards.
When ‘stacking value’ has an entry fee
The value created by flexibility flows primarily to those who own assets - and that ownership generally requires three things: capital, property and control over that property. Not everyone has access to any of them, let alone all three.
Fuel poverty statistics illustrate the scale of the issue. According to DESNZ, 2.36 million English households were living in fuel poverty in 2025 according to the Low Income Low Energy Efficiency (LILEE) measure. The average fuel poverty gap stood at £379, with an aggregate gap approaching £900 million. Using a broader affordability metric, the number of households spending more than 10% of income after housing costs on energy rises to 7.63 million.
Whilst the benefits of flexibility are clear for those who can afford the upfront costs necessary -there is an increasing argument that flexibility creates an unequal distribution of benefit. Households that are able to invest in technologies that can unlock the multiple flexibility revenue streams can see net income from the system and thus avoid paying any of the costs of the system, while those who are least able to pay see the impact in higher socialised network costs.
Evidence from early Demand Flexibility Service participation proves the point. NESO survey data shows lower participation among lower-income households, renters, younger consumers and urban residents. The most significant under-representation was among those aged 18 to 24.
The same survey did also find meaningful participation among tenants and people with long-term health conditions, suggesting barriers can be overcome But it does points towards a market that, at least right now, is attracting those who are most able to pay.
The standing charge dilemma
The debate becomes even more acute when we look at system cost recovery. Most of the costs associated with maintaining and expanding Britain’s electricity system are recovered through standing charges and network costs that are shared across consumers via their energy bills. Citizens Advice has repeatedly warned that poorly designed charging arrangements could lead to outcomes where affluent households avoid paying a proportionate share of network costs while lower-income consumers face higher bills, all whilst those network costs are expected to rise.
Modelling by Ember suggests network charges could increase from approximately £75/MWh in 2023 to between £89 and £100/MWh by 2030 as transmission and distribution investment accelerates. National Grid is expected to invest billions annually in infrastructure upgrades needed to support electrification and decarbonisation.
The very valid concern is that those growing fixed costs may increasingly be recovered from those ‘least able to pay’ households that continue to rely heavily on imported electricity, while households with generation and storage increasingly minimise their exposure.
The equity fix and the growth opportunity
It’s not all negative – there are solutions that align with the wider energy industry’s commercial objectives. Bidirectional flexibility programmes such as Octopus’s Agile Octopus or E.ON Next’s Smart Saver need little upfront investment beyond a smart meter and consumer engagement and can be accessed by anyone.
Alongside these tariffs, organisations including the New Economics Foundation are calling for the expansion of no-upfront-cost models, including subscription-based solar schemes that allow households to access technology benefits without significant capital expenditure.
There’s great potential across the UK’s social housing portfolio too, which could go some way to reduce real fuel poverty, as well as supporting the grid. Energy UK has argued that coordinated deployment of solar, batteries and heat pumps could dramatically reduce household bills when paired with flexible energy use. For many lower-income consumers, social housing providers that work to deliver flexibility may provide a more realistic pathway to participation than owner-occupier retrofit.
Regulatory reform also matters. Ofgem is working to establish a single point of registration for flexible assets that could reduce costs for providers and make smaller-value customers more commercially viable to serve. Whilst some of this sounds like tinkering around the edges, it could help to start to make flexibility services, and the value they deliver to consumers, available to far more households. It’s a crucial point, because if flexibility is expected to deliver that vital 10GW to 12GW of capacity by 2030, we can’t just rely on households with the £10,000 to spare for rooftop solar and battery storage.
If consumer flexibility is genuinely a critical part of Britain’s energy transition, inclusion can’t just be a social objective – it’s the missing part of the puzzle.