As demand-side flexibility moves from niche innovation to a core pillar of Europe’s energy transition, the questions facing the sector are becoming more complex, and more contentious. Business models are evolving, markets are consolidating, customer engagement remains a challenge, and the industry’s assumptions are being tested in real time.
To create space for these conversations, smartEn launched What the Flex!: a new interactive debate format that moves beyond traditional panel discussions. In this session, which was hosted at The Smarter E Europe 2026 in Munich, rather than delivering prepared presentations, participants were challenged to respond to provocative questions, defend their positions, and debate some of the biggest issues facing flexibility markets today.
During this edition, industry leaders tackled four questions that cut to the heart of the sector’s future. The result was a fast-paced discussion that revealed both areas of consensus and differences in perspective. While no single answer emerged, one message came through consistently: scaling flexibility will require open markets, customer-centric solutions, stronger collaboration across the value chain, and a willingness to challenge long-held assumptions.
Below, we summarise the key insights from each debate.
Is consolidation in flexibility markets (tech platforms buying hardware, aggregators turning into full energy suppliers) healthy or are we building new monopolies?
Rolf Bienert (OpenADR Alliance)
The market is still early and there will be multiple viable business models. The key point is not whether consolidation happens, but what the system is trying to achieve: a sustainable grid that can serve everyone, without excessive price increases or volatility.
There’s a parallel with the telecom sector: real progress only became possible once standards were widely adopted. Different players can coexist, but interoperability is essential. Some companies will exit the market, others will scale, but the underlying systems—hardware and software—must be able to connect and work together. Without that, the system fragments and efficiency is lost.
Cristina Corchero (Bamboo Energy)
The focus should not be on labels like “independent” versus “vertically integrated.” What matters is market maturity.
A functioning flexibility market requires openness and transparency, with the customer at the center. Users must be able to easily switch providers, understand their options, and access flexibility services without friction. If flexibility is not simple and accessible, it will not scale.
In that sense, consolidation is not inherently good or bad. The real question is whether the market structure enables competition, clarity, and easy participation for end users.
Wim Croes (LIFEPOWR)
From a consumer perspective, flexibility is still complex and difficult to understand. Most customers do not engage with technical market concepts such as imbalance markets, FCR, or ancillary services. They care about a simpler question: when will they recover their investment in assets like solar panels or batteries?
Whether companies are consolidated or independent is secondary. What matters is transparency across the value chain and clear value flows. Everyone in the chain takes a share of the value created, and that should be explicit rather than hidden.
If flexibility is to scale, consumers need clarity on what they earn, who takes what margin, and how their investment contributes to both financial return and the broader energy transition.
Sharing flexibility portfolios vs building in-house: which model is more profitable and will be still standing in five years?
Alexandra Houston (Energy Pool)
Is “profitability” the right lens? What matters more is the underlying commercial structure: how revenues and costs are shared between partners, and what each party contributes in terms of capability. That determines margin distribution more than any simple profitability metric.
If reframed through cash flow, the direction is clearer: integrated partnerships tend to win. They enable faster market access and better alignment with client demand, particularly as customers increasingly look for bundled solutions that cover BRP, BSP, and supplier roles in one package.
That integration has financial implications. It can reduce upfront investment, accelerate revenue generation, and improve cash-flow timing, thereby improving overall financial performance.
On the five-year outlook, we should be cautious. The market is likely to continue consolidating through cycles of cooperation, acquisition, and restructuring, rather than stabilising into a single dominant model.
Alexander Kofink (Cybergrid)
The starting point is strategic: energy is becoming a critical infrastructure factor in Europe, and flexibility is central to competitiveness. Shared flexibility portfolios could accelerate market entry, reduce time-to-market, and enable more comprehensive value propositions through complementary solutions.
In the next five years, the most successful players are likely to be those that combine strong in-house capabilities and automated solutions, with strategic partnerships. While building proprietary technologies can drive innovation and differentiation, partnerships expand market reach, accelerate learning, and enable access to new use cases.
Ultimately, the energy transition depends on collaboration. Flexibility solution providers, EMS vendors, VPP operators, battery suppliers, and other market participants all share the goal of integrating more renewables and flexibility into the power system. As a result, collaborative and interconnected ecosystem models are likely to remain both profitable and resilient in the years ahead.
Arne Berresheim (Powernaut)
From a technical-operational perspective, becoming a balancing responsible party requires forecasting, device control, trading capability, and market “plumbing.” In practice, this translates into a significant software and operational burden.
Because of this complexity, many companies initially rely on partners. However, the long-term trajectory points towards increasing internalisation of these capabilities, driven by automation and software-first architectures that reduce operating costs and headcount requirements.
Not all organisations are structurally equipped to build this themselves today, but over time the pressure to internalise core capabilities will increase. The cost dynamics of manual operations make software-driven in-house solutions increasingly attractive.
Most consumers won’t switch tariffs or track prices just to get paid for their flexibility. Who should own that flexibility complexity instead, and is anyone making real money from it today?
Diogo Brito (Smart Energy Lab)
Consumers are not interested in complexity and are generally risk-averse. They will not actively optimise their consumption or track dynamic prices, and any viable model has to start from that assumption.
Given that, the complexity has to sit elsewhere, and retailers are the most likely candidates to absorb it. They would offer customers simple, flat tariffs while managing the underlying flexibility in the background. But in doing so, the retailer takes on the risk of price volatility: a flat tariff leaves them exposed when wholesale prices move against them.
To reduce that exposure, retailers need a de-risking layer. In my view, the solution is to stack and coordinate a range of flexible assets, such as batteries, EVs, heat pumps, and other controllable loads, to offset that price exposure and stabilise revenues.
But that whole model rests on an assumption that rarely holds in practice: that the assets are connected, reachable, and consistently available to be dispatched. In reality, flexibility sits behind a fragmented landscape of brands, protocols, and gateways that speak different languages and drop offline without warning. If an asset can’t be reliably reached and controlled, it can’t be counted on for flexibility. This is precisely the problem our solution REEF answers to, providing the connectivity and integration layer that turns a scattered fleet of assets into a dependable, dispatchable pool.
This model is only feasible with a high degree of automation and standardization. Without that, scaling becomes operationally impossible.
On profitability, the assessment is blunt: at scale, no fully mature model is yet making consistent “real money.” Most activity is still fragmented and asset-specific. The real value will accrue to the actors capable of managing multiple asset classes reliably and at scale, and that gap is still largely open.
Braeden Holmes (Gridio)
Consumer engagement is fundamentally low. Flexibility is not something end users understand or care about in technical terms. If it cannot be explained simply, it effectively does not exist from their perspective.
Incentives matter more than messaging. Without a clear financial or practical reason to participate, consumers will not connect their assets.
This creates a structural dependency on utilities and retailers. If they cannot translate flexibility into simple products and credible incentives, nothing scales. Across multiple utility programmes, the same issue persists: internal misalignment and complexity prevent effective customer engagement.
On value capture, a disproportionate share of revenue is currently absorbed by legal and risk functions, which prioritise de-risking over deployment. In many cases, organisations spend significantly more on managing contractual and regulatory risk than on actually activating flexibility assets.
The system is therefore inefficient: multiple actors extract small shares of value, but the overall pie remains underdeveloped.
Benjamin Dobberke (Podero)
The core challenge is not interest in flexibility, but timing and context. Stakeholders are engaged while actively participating in energy systems, but disengage once attention shifts back to daily life.
This creates a persistent communication gap between those designing flexibility products and end users who ultimately must adopt them.
Two mechanisms currently work best in practice: upfront bonuses and simple add-on incentives. Small, clear financial rewards are effective in driving participation.
However, requiring consumers to change contracts or actively manage flexibility is unlikely to scale. The model that works is passive participation with embedded incentives, not active optimisation.
What is the biggest myth in flexibility — and what would happen if everyone stopped believing in it?
Wim Croes (LIFEPOWR)
The myth is already largely broken. The assumption that industrial-scale batteries and large assets could reliably generate high returns purely from imbalance markets or ancillary services has been undermined by market evolution and increased competition.
The industry is now shifting towards value stacking: combining multiple revenue streams rather than relying on a single market signal. A key part of this is behind-the-meter optimisation, where value is created closer to the customer through self-consumption, visibility of savings, and simple user feedback (for example, battery charging aligned with solar generation).
Another outdated belief is that flexibility is optional for achieving acceptable returns on energy assets. In reality, flexibility is now a necessary condition to unlock viable investment returns and to support continued deployment of distributed energy resources.
If the myth fully disappears, the implication is straightforward: business models that rely on single-stream revenue collapse, while integrated, multi-layer optimisation becomes the default.
Arne Berresheim (Powernaut)
The central myth is that the value of flexibility will decline over time. The opposite is more likely.
Structural changes in demand — such as electrification and new loads like air conditioning — are already increasing volatility in electricity markets. This leads to wider price spreads and stronger system imbalances, which in turn increase the need for flexibility.
Rather than becoming less relevant, flexibility becomes more structurally embedded in system operation. If the myth of declining value disappears, investment signals strengthen, and flexibility becomes a permanent feature rather than a transitional one.
Diogo Brito (Smart Energy Lab)
The key misconception is that the ecosystem is already fully functional and standardised. There is a widespread assumption that assets are connected, interoperable, and consistently available.
In practice, operational reality is less stable. A significant share of deployed assets is frequently offline due to configuration errors, connectivity issues, or firmware and OEM-related problems. These failures are not marginal; they are structural.
This creates a gap between theoretical flexibility potential and actually dispatchable flexibility.
If the myth disappears, responsibility shifts. It becomes clear that delivering flexibility is not only a software or market design issue, but a full value-chain problem involving OEMs, installers, aggregators, and retailers. Without this alignment, system reliability assumptions break down.
And the winner is...
After four rounds of lively debate and audience voting, Smart Energy Lab was crowned the winner of this edition of What the Flex!
Smart Energy LAB is a factory for developing any new product, service, or process that accelerates the business of companies offering New Energy Downstream solutions.
They do it by combining three levers of acceleration of the end-user energy transition – Client adoption, Transactional cost reduction and Technology adaptation for delivery – and boosting a highly qualified team with competencies in Business, Customer Experience and Technology.
Their contributions consistently challenged conventional thinking while remaining grounded in the practical realities of deploying flexibility today. From arguing that retailers should absorb complexity on behalf of consumers, to highlighting the operational challenges of keeping connected assets online at scale, Smart Energy Lab made a compelling case that the next phase of flexibility will depend not only on market design, but on solving the technical and customer-facing barriers that still exist.
Congratulations to the Smart Energy Lab team represented by Diogo Brito, and thank you to all participants for making the inaugural edition of
What the Flex! a lively and thought-provoking debate.
But the conversation doesn’t end here
The debates showed that there are few simple answers when it comes to scaling flexibility. While perspectives differed on topics ranging from market consolidation to customer engagement and business models, participants agreed on one point: the sector is evolving rapidly, and challenging assumptions is essential to building better flexibility markets.
What the Flex? is designed to keep those conversations going, bringing together smartEn members to debate the issues that will shape the next phase of Europe’s energy transition.
Want to join the discussion? Become part of the smartEn community, explore our latest work on demand-side flexibility, and follow us on LinkedIn and YouTube to stay informed about future What the Flex! debates and other smartEn events!
