A recent development in the UK energy market should matter to every business with flexible load, batteries, onsite generation or controllable assets.

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On 12 May 2026, Elexon confirmed that NESO’s evolved Demand Flexibility Service has gone live with DNO primacy arrangements embedded directly into DFS procurement. In plain English, this means flexibility can now be procured with better coordination between the national system operator and local distribution networks, helping ensure that demand-side actions support the wider system without creating local network issues.

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For PowerSync, this is exactly the direction the market needs to move: flexibility that is not just available, but visible, coordinated, compliant and dispatchable.

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Flexibility is moving from emergency response to core market infrastructure

The Demand Flexibility Service began as a tool to access additional megawatts during periods of high national demand. But NESO’s Summer Outlook 2026 shows how far it is evolving. For summer 2026, NESO is expanding DFS into a bi-directional service, including the ability to increase demand during periods of excess supply, reduce eligibility thresholds, introduce locational procurement and embed primacy rules.

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That is a major shift. Flexibility is no longer only about turning down during winter peaks. It is becoming a practical operating tool for managing both sides of the system: reducing demand when supply is tight and increasing demand when renewable generation is abundant.

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For industrial and commercial businesses, this creates a new opportunity. Flexible load, batteries, backup generation, HVAC, refrigeration, EV charging and other controllable systems can become part of the electricity system’s operating toolkit — while creating commercial value for the site.

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Why DNO primacy matters

The UK flexibility market has a coordination problem that DNO primacy is designed to solve - opening a very valuable market for business. A site may be valuable to NESO for national balancing, but its operation can also affect the local distribution network. Without coordination, a flexibility action that helps the national system could create a local constraint, voltage issue or network security concern.

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Elexon says the new Risk of Conflict capability allows DNOs to identify where NESO procurement could cause operational issues and flag these ahead of time, feeding directly into live DFS procurement decisions.

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This is important because it makes flexibility more credible. It gives networks confidence that flexible assets can participate without compromising local network security. It also gives customers and aggregators a clearer pathway to participate in markets where local and national requirements need to be managed together.

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This is the start of a more coordinated flexibility market

The DNO primacy development sits within a much broader reform agenda.

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Ofgem has appointed Elexon as the UK’s Market Facilitator, with a mandate to align local and national flexibility market arrangements, reduce friction, increase liquidity and unlock the full value of flexibility. NESO says the Market Facilitator will establish and own Flexibility Market Rules covering rules, processes, standards and services that DNOs and NESO must comply with through their licences.

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NESO also notes that the Market Facilitator’s scope includes the Balancing Mechanism, ancillary services and DNO services, and that the flexibility market catalogue is intended to help providers compare opportunities across NESO and DNO markets.

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For businesses, this points to a clear direction of travel: flexibility markets are becoming more structured, more standardised and easier to access.

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What this means for businesses

For large energy users, the opportunity is no longer limited to reducing consumption during occasional peak events.

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A business with flexible energy assets may be able to participate across multiple value streams, including DFS, balancing services, local DNO flexibility markets, capacity mechanisms, wholesale optimisation and supplier-led flexibility products.

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But the opportunity also becomes more complex. Assets need to be controlled within site limits, market rules, supplier arrangements and network constraints. Dispatch needs to be measured, auditable and reliable. Participation needs to avoid conflicts between national and local requirements. That is why orchestration matters.

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The next phase of flexibility will not be won by businesses simply having flexible assets. It will be won by businesses that can operate those assets intelligently.

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Where PowerSync fits

PowerSync connects to site assets and coordinates them in real time in response to market and grid signals.

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That includes batteries, flexible load, onsite generation, EV charging, cooling systems, process equipment and other controllable assets. The platform is designed to optimise participation across multiple value streams while respecting operational constraints, asset limits and customer priorities.

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In the context of DNO primacy and the evolved DFS, this matters because flexibility must now be more than technically available. It must be coordinated with the requirements of both the national system and the local network.

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PowerSync’s role is to make that participation practical for businesses: identifying flexibility, integrating with site systems, automating dispatch, tracking performance and helping customers access value without disrupting operations.

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The takeaway

The launch of DNO primacy within NESO’s evolved Demand Flexibility Service is more than a technical market update. It is a signal that the UK flexibility market is maturing.

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Flexibility is becoming locational, coordinated and increasingly embedded in the way the electricity system is operated. For businesses with flexible load, batteries or onsite generation, that creates a growing commercial opportunity - but only where participation can be managed safely, transparently and intelligently.

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The UK energy system is not just asking for more generation. It is asking for smarter demand, smarter assets and smarter orchestration.

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Contact PowerSync Technologies today to explore how your flexible load, batteries and onsite generation can participate in the UK’s evolving flexibility markets while protecting core operations.

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