What is demand side management?
Demand side management, also known as demand side response, is where businesses adjust energy usage during peak times or when renewable supply is high, contributing to grid stability and earning revenue.
If businesses agree to shift their electricity use in response to a price or grid signal, it offers the system additional flexibility and helps keep Britain’s electricity system in balance. Flexibility is vital for integrating intermittent renewable generation assets and is a great way to save money and reduce carbon emissions.
Flexibility Service Providers and Aggregators like us pool assets to provide essential grid services. We help businesses maximise value by contributing to grid stability and earning revenue through energy optimisation programs, all while supporting decarbonisation.
Capacity Market Services
Introduced in 2014, this service requires your asset to respond within 4 hours of an Capacity Market notice.
This program is technology agnostic and open to all assets subject to a “de-rating”, but that doesn’t mean it’s simple. This program requires comprehensive testing/certifications that our team are able to manage on behalf of our third-party assets.
This is an availability payment-based service that can be dispatched when required by NESO, however, although it provides a crucial safety net, and had several utilisation notices provided, it’s never been utilised resulting in little disruption to generators and businesses.
Reserve Services
Typically, there are two reserve services, a fast and slow program. They are in place to give NESO time to find alternate forms of generation/demand in response to a grid event, this can be an increase or decrease in demand.
Depending on the program, the response time required ranges from 1 – 20 minutes. This service is more regularly dispatched than the Capacity Market, however, it is still infrequent, especially in the case of the slower reserve services.
This service offers both availability and utilisation payments and can be dispatched when required by NESO. Payment is based on performance of utilisation, as well as the available capacity to grid.
Frequency and Dynamic Services
There are a range of frequency and dynamic products, with minimum response times ranging from 0.5 and 30 seconds. Both negative and positive services can be procured at the same time.
These programs are called on more frequently when alternative generation/demand sources aren’t available within short time frames.
These services produce the most revenue per MW, due to the complex and strict requirements needed to respond to a signal within such a short time frame.
DNO and Local Flexibility
Sometimes there are scenarios where the national transmission system is balanced but due to limited interconnection between local grids and national systems, the local distribution network is imbalanced.
This means some zones that can’t export any additional generation may require flexible assets that can turn their demand up, and vice versa for zones that can only import so much.
This provides value for the DSO’s, as it limits the risk to expensive transmission/interconnecting equipment that could be at risk of overload.
Demand Flexibility Service
Re-introduced in November 2024, this service has changed from a winter auxiliary service, to a merit based balancing tool that competes with the balancing mechanism
This is an intra-day service with requirements being published in the morning, competition taking place within an hour, and dispatch later the same day.
This is a fantastic alternative to those who cannot participate in the balancing mechanism due to the short notice requirement.
Balancing Mechanism
Introduced in March 2001, this is NESO’s main tool to ensure overall grid balance and no zonal (TSO) constraint.
Balancing mechanism auctions open 90 minutes before a settlement period, and close in just 30 minutes. The format is bid offer acceptance.
This service is incredibly valuable however, offers more punitive measures for non performance. We typically enter our more reliable assets into this mechanism.
The Wholesale Market
An established trader, ENGIE began participating in the wholesale market on behalf of its assets in November 2024.
Like the balancing mechanism, this is a high-risk market so we will typically only introduce our more reliable assets and use our wider portfolio to eliminate risk.
We can also stack this market with a wide range of our programs, to generate revenue across all of these services.
Our Customer Journey
Why ENGIE?
500 MW+
Third-Party assets under flexibility management
24/7
Trading Desk to respond to quickly to any changes in pricing or grid signal
Top 5
Part of the top 5 Independent Flexibility Providers by capacity
300+
Individual sites aggregated across GB
100 MW+
Third-Party Low carbon assets under management
40+
Different generating and demand side technologies fully optimised within our portfolio
Maximising value for your business
ENGIE provides expertise, tools, and strategies to turn energy flexibility into financial and environmental benefits
Frequently asked questions
Demand-side management involves adjusting energy use during peak times or when renewable generation is high to benefit both the grid and your bottom line.
By taking advantage of your flexibility, ENGIE helps you capitalise on market opportunities, reduce costs and earn revenue through participation in grid-balancing services.
ENGIE employs AI-driven platforms, real-time data analytics and cutting-edge optimisation tools for unparalleled energy management.