Flex Markets Unlocked Innovation Programme: successful projects
Source: gov.uk (2025-12-04)

This programme funded and supported the design and development of innovative technical solutions that could facilitate system-wide coordination and standardisation across multiple flexibility markets.

The Flex Markets Unlocked Innovation Programme ran from 2023 to 2025. See details of the competition guidance (https://assets.publishing.service.gov.uk/media/6745c00cda210676b4ffe137/flex-markets-unlocked-phase-1-sbri-competition-guidance.pdf).

The programme committed up to £2.60 million to support projects that designed and developed innovative technical solutions to facilitate system-wide coordination, standardisation and revenue stacking across multiple flexibility markets (markets within which flexibility can be bought or sold) to allow a more diverse and competitive marketplace, unlocking flexibility.

Programme structure

The programme consisted of 2 phases:

Phase 1 - up to £600,000 funding for 3 feasibility studies to develop robust technical specifications for proposed technical solutions. See details of the funded projects from this phase: Flex Markets Unlocked Innovation Programme: Phase 1 projects (https://www.gov.uk/government/publications/flex-markets-unlocked-innovation-programme-successful-projects/flex-markets-unlocked-innovation-programme-phase-1-successful-projects).

Phase 2 - up to £2 million funding for the development and demonstration of their technical solution. See details of the funded project from this phase: Flex Markets Unlocked Innovation Programme: Phase 2 projects (https://www.gov.uk/government/publications/flex-markets-unlocked-innovation-programme-successful-projects/flex-markets-unlocked-innovation-programme-phase-2-successful-projects).

Programme completion

The Flex Markets Unlocked Innovation Programme concluded at the end of March 2025. The competition funded three feasibility studies and supported one project through to the demonstration phase. A fully working version of the proof-of-concept technical solution was delivered in Phase 2 and demonstrated under a simulated market environment. This facilitated system-wide coordination, standardisation and revenue stacking across multiple flexibility markets.

The programme formed part of the Department for Energy Security and Net Zero’s innovation portfolio, supporting the transition to net zero by enabling distributed energy resources (DER) to participate in markets and provide system-wide flexibility in large volumes. This supports a more diverse and competitive marketplace – unlocking flexibility.

Final project report
- Flexibility Markets Unlocked: phase 2 - final report (https://assets.publishing.service.gov.uk/media/69316d99cdec734f4dff4224/Flexibility_Markets_Unlocked_final_report.pdf)
Background

Without low carbon flexibility - the ability to shift the consumption or generation of energy in time or location to balance supply and demand – the system will be less secure and more expensive. Analysis from the 2021 Smart Systems and Flexibility Plan (https://www.gov.uk/government/publications/transitioning-to-a-net-zero-energy-system-smart-systems-and-flexibility-plan-2021) estimated that deploying flexibility could save up to £10 billion per year by 2050.

Decarbonisation of our energy system including the electrification of transport and heating will drive the deployment of millions of distributed assets including electric vehicles, heat pumps and smart appliances. Key to achieving a smart and flexible energy system will be harnessing the value of distributed energy resources (DER) like these. Using these sources of demand flexibly – both in domestic and non-domestic sectors - represents a huge opportunity to make better use of our homegrown renewable electricity, reduce our dependence on gas and lower consumer bills.

However, barriers for DER market participation have been observed, including:
- low participation in major national markets due to operational complexity and higher perceived risk, aggravated by a lack of visibility on both the buy and sell side
- difficulties in revenue stacking because markets are not coordinated, limiting the scale and variety of DER that is coming forwards, as well as limiting market liquidity
- complicated market entry process particularly for smaller entrants, with opportunities fragmented across several markets with different registration, qualification and monitoring requirements
This programme aimed to address these barriers by designing and developing solutions which could improve the ease of access to markets, market coordination and revenue stacking across markets to get DER actively participating to provide system flexibility in large volumes.

This programme was part of the Flexibility Innovation Programme (https://www.gov.uk/government/publications/flexibility-innovation) which sought to enable large-scale widespread electricity system flexibility through smart, flexible, secure, and accessible technologies and markets. The Flexibility Innovation Programme funded innovation across a range of key smart energy applications, and sat within the Net Zero Innovation Portfolio (https://www.gov.uk/government/collections/net-zero-innovation-portfolio) (NZIP).