Demand-side flexibility is increasingly seen as central to managing a more volatile, renewables-led power system. It can help balance fluctuations in generation, ease pressure on grids at peak times and strengthen overall supply security. “Europe’s power system needs demand-side flexibility to keep supply and demand in balance as renewable generation grows and grids come under increasing strain,” says Michael Villa, chief executive of smartEn, the European industry association for flexible demand management.
Analysis: Demand-side flexibility challenges storage in key markets
How effectively companies can adjust internal operations to make better use of renewable electricity is becoming a key factor. This does not necessarily require major new investment. One example is Ornua Foods Deutschland, which processes around 80,000 metric tonnes of Irish butter each year for the German and Austrian markets.
Since 2023, the company has used an AI-based energy management platform to align electricity consumption with a dynamic tariff. Compressor, cold storage and steam generation processes are scheduled 24 to 72 hours in advance and adjusted in real time in response to operational needs and market signals. In the first year, savings exceeded €9,600, with the system paying for itself within 14 months.
Flexibility pays off
It pays off for businesses to be flexible. “By shifting electricity use to times when clean power is abundant, industrial and commercial companies can lower energy costs and even generate new revenue by providing flexibility services to the grid. The technologies and solutions already exist – from smart energy management to aggregated demand response. What Europe needs in 2026 are strong policy signals and market frameworks that fully enable demand-side flexibility to participate in electricity markets and support a more resilient, efficient energy system,” says Michael Villa.
SolarPower Europe sets out new vision for energy flexibility
For companies that use a lot of energy, flexibility is the key to reducing energy costs. This includes steel and cement plants as well as aluminum, paper and glass factories. These companies may find it worthwhile to quickly purchase cheap renewable energy from the spot market on the same day (intraday trading) or on the next day (day-ahead trading) and then selling their self-generated or stored electricity at higher prices. Special service providers, such as Energy2market, handle the marketing of electricity.
With its multi-market approach, the company markets battery storage in the industrial sector depending on the season. Kai Becker, Head of Development at Energy2market, says that peak shaving is useful in the winter because it prevents expensive peak loads in electricity consumption. One of the Energy2market’s customers, an aluminum plant, saves 200,000 euros per year through these measures alone. During the summer months, trading on the short-term electricity market is worthwhile due to significant daily fluctuations in spot market prices.
Coupling and revenue through power-to-heat
It can also be worthwhile to market the flexibility of heating systems, for example when it comes to power-to-heat in process heat generation. If there is surplus electricity in the power grid, it can be diverted from the grid to heat up hot water tanks. The Munich-based company Entelios has experience with such projects, reporting that retrofitting a pre-existing 10 megawatt boiler pays off after just a year and a half.
Why coordination, not capacity, will define Europe’s next energy phase
“Flexibility is a key resource in our volatile energy system. Our KRITIS-certified hardware and software platform automatically controls industrial loads, storage and sector-coupled plants, enabling companies to get the best price and serve the grid. This reduces energy costs and unlocks additional revenue through intraday trading and balancing reserve,” says Dr. Florian Hirsch, CTO of Entelios. The balancing reserve is used to offset short-term imbalances in the grid and maintain a stable power line frequency of 50 hertz.
EM-Power Europe 2026 puts spotlight on individual concepts
Most companies already see the financial value of flexibility and load management: a McKinsey survey found 80 percent of German firms are implementing or planning such measures. However, because operational needs vary, demand-side flexibility requires tailored solutions. EM-Power Europe (23–25 June) offers guidance and connects companies with technology partners.
Further insights will be shared at The smarter E Forum and EM-Power Europe Conference, with sessions on best practices, regulatory changes and the value of flexibility in industry. A webinar on 5 May will address how energy-intensive industries can leverage flexibility for a competitive edge. (hcn)
