Demand-side flexibility can offset fluctuations in power generation, relieve grids during peak periods and help secure supply. The potential is considerable, and the business case is catching up fast. "The European electricity grid needs demand-side flexibility to keep supply and demand in balance," says Michael Villa, Managing Director of smartEn, the European business association for demand-side flexibility.
Industrial and commercial operators can reduce their energy costs through flexible control of electricity consumption without necessarily investing in new equipment. Ornua Foods Deutschland is a case in point. The company processes 80,000 tonnes of butter each year and has used an AI-based energy management platform with a dynamic electricity tariff since 2023. Operating times for compressors, cooling systems and steam generation are optimised 24 to 72 hours in advance and adjusted in real time. More than €9,600 was saved in the first year alone, and the investment paid for itself within 14 months.
Michael Villa: "Demand side flexibility is a strategic asset"
"By shifting electricity consumption to periods with a high share of clean power, industrial and commercial businesses can lower their energy costs and generate additional revenue by providing flexibility services to the grid," Villa says. Technologies such as intelligent energy management and aggregated load control already exist. What Europe needs in 2026 are political signals and market frameworks that allow demand-side flexibility to participate fully in electricity markets and support an efficient energy system.
Key to cost reduction in energy-intensive sectors
Flexibility is a key lever for reducing costs in energy-intensive sectors in particular, including steel, cement, aluminium, paper and glass production. Spot markets make it possible to buy renewable electricity cheaply at short notice or sell stored electricity at a profit. Service providers such as Energy2market deploy industrial battery storage differently across the seasons. In winter, peak-shaving helps avoid expensive load peaks, saving one aluminium plant €200,000 a year. In summer, trading on the spot market becomes attractive thanks to wide price swings.
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Flexibility from heating systems is also lucrative, for instance in process heat through power-to-heat applications. Surplus electricity is used to charge thermal storage units. Munich-based Entelios reports that the conversion of an existing 10 MW boiler paid for itself within 18 months. "Flexibility is the key resource in a volatile energy system," says CTO Dr Florian Hirsch. Using a certified hardware and software platform, Entelios automatically controls industrial loads, storage and sector-coupled systems so that companies can operate in a price-optimised and grid-friendly manner. This reduces energy costs and unlocks revenue from intraday trading and from balancing reserves, which offset short-term imbalances in the grid and keep its frequency stable.
The smarter E Europe: cameras rolling on innovation
Many companies recognise the benefits of flexibility and load management. According to a survey by McKinsey & Company, 80 percent of German companies are either implementing such measures or planning to do so. Because every operation has its own processes and load profiles, demand-side flexibility is rarely an off-the-shelf product. Implementation calls for tailored concepts. Companies can find guidance and suitable technology partners at EM-Power Europe. (hcn)
