In Part 2 of Smart Talks with Jovan – Season 9, the discussion moves from the broader challenges of scaling flexibility toward the practical foundations required to make it a dependable part of energy-system operation.

Elena, Gerry and Dr. Ana Trbovich explore the relationship between trusted data, regulatory collaboration, grid reinforcement and local energy communities. Their discussion highlights a central challenge for the next phase of flexibility: moving beyond individual pilots and proving that distributed resources can become visible, reliable and valuable enough to support real network decisions.

The conversation focuses on three key questions: whether market-based flexibility can succeed without trusted data and strong collaboration, whether flexibility can become a credible alternative to grid reinforcement, and whether DSOs and regulators should prioritize data access or local energy communities.

Can market-based flexibility succeed without trust in data and strong collaboration between regulators, DSOs and market participants?

Elena:

Market-based flexibility cannot reach meaningful scale without trusted data and close collaboration between regulators, DSOs and market participants.

Grid reinforcement takes years, while renewable generation, electrification and new connection requests are increasing pressure on electricity networks much faster. Flexibility can help bridge that gap, but only when system operators have sufficient visibility to treat it as a dependable operational resource.

DSOs need to understand exactly where network constraints exist, when they occur and which flexibility resources can be reliably activated.

Without granular network visibility, flexibility becomes an assumption rather than an operational planning tool.

This is particularly important when grid operators are deciding whether infrastructure investments can be postponed or reduced. No network operator can reasonably defer major reinforcement based on resources that it cannot see, measure or depend on.

Regulation must therefore make it possible for a broad range of distributed resources to participate.

If flexibility markets are designed primarily around large assets, much of the potential available from heat pumps, electric vehicles, buildings, industrial loads and other distributed resources remains inaccessible.

For this reason, flexibility should not be treated as a replacement for physical networks.

It is often described as a non-wire alternative, but the energy system cannot ignore the wires. Flexibility and grid investment must develop together, with data providing the evidence required to determine when flexibility can safely support or defer traditional reinforcement.

Gerry:

From the DSO perspective, visibility and reliability are fundamental.

Network operators responsible for system operation need to know whether flexibility can actually be seen, accessed and controlled before they can incorporate it into operational planning or planned maintenance.

This creates a challenge during the early stages of market development.

A DSO may require one megawatt of flexibility in a particular location, but it may need significantly more than one megawatt of available or contracted resources to ensure that the required response can reliably be delivered when needed.

Scale and diversity therefore matter.

The larger and more diverse the available flexibility pool becomes, the more confidence system operators can have that sufficient capacity will be available at the required moment.

Collaboration with regulators is equally important.

Flexibility markets are developing within complex regulatory frameworks, and different stakeholders may interpret the same requirements differently. This can create uncertainty about whether a proposed flexibility product or customer offering is fully aligned with regulation.

Close cooperation between DSOs and regulators can reduce this uncertainty and make market development more predictable.

More detailed regulatory guidance could also help increase participation from aggregators and energy suppliers, particularly in areas such as customer acquisition.

As flexibility markets mature, DSOs should not be expected to develop the entire customer base themselves. Aggregators, suppliers and other market participants need clearer opportunities to bring customers and distributed resources into the market.

Ana:

Collaboration should extend beyond regulators, DSOs and traditional aggregators.

Energy communities can also act as aggregators of distributed flexibility and provide services directly to distribution networks.

Many discussions about aggregation focus on participation in large wholesale flexibility markets. However, significant flexibility also exists at much smaller and more local levels.

Individual households, small renewable generators and distributed assets may be too small to participate independently, but energy communities can combine these resources and transform them into useful flexibility products.

This could create an additional layer within the flexibility market.

Resources could first be aggregated and traded locally between households and communities before being combined into larger products for wider flexibility markets.

Such an approach could unlock resources that currently remain outside the market despite already being technically available.

The necessary metering infrastructure is increasingly present, but two important elements are still missing: interoperable systems that allow secure access to distributed resources and regulatory frameworks that permit local trading and aggregation.

Customers should also retain meaningful control over their assets and their data.

A trusted and interoperable system should allow citizens to authorize different service providers to access relevant data and provide flexibility services without forcing them to surrender control of their infrastructure or become dependent on a single platform.

Collaboration therefore needs to include not only regulators and market participants, but also energy communities, civic organizations and consumer groups.

Creating a functioning flexibility ecosystem requires all of these actors to understand what is technically possible and how the resulting market can serve both network requirements and customer interests.

Can flexibility become a real alternative to grid reinforcement without granular data and regulation that supports smaller-scale solutions?

Gerry:

Flexibility should be viewed as complementary to network reinforcement rather than as a simple replacement for it.

Electricity networks still require substantial investment in transformers, lines, capacity and other physical infrastructure.

In Ireland, major distribution-network investment is already being planned through the current regulatory price-review process. This reinforcement remains essential because flexibility alone cannot remove every physical limitation of the grid.

At the same time, grid projects take years to plan and deliver.

Even a five-year period may not be sufficient to complete all of the reinforcement required by a rapidly changing electricity system.

Flexibility can create valuable operational space during that period.

It can help network operators manage constraints while new infrastructure is being planned and built, but the market must become considerably larger before flexibility can consistently play that role.

One of the principal challenges is liquidity.

When only a limited amount of flexibility is available in the market, it becomes difficult to compare flexibility directly with traditional reinforcement through conventional cost-benefit analysis.

As more customers, aggregators, communities and distributed resources participate, flexibility will become easier to evaluate as part of the wider network investment value stack.

The key requirement is therefore scale.

Flexibility does not need to displace network investment entirely. Instead, it needs enough market participation and reliable capacity to become a credible option alongside reinforcement.

Elena:

Granular data is the foundation for turning flexibility from a collection of individual projects into a functioning ecosystem.

A national flexibility strategy must answer a fundamental question: how can assets owned by many independent actors be coordinated when those actors may not want to surrender their raw data or provide direct access to their infrastructure?

This makes trust one of the central challenges.

The solution does not necessarily require every participant to hand over all of its underlying data.

Modern digital architectures can enable coordination and secure data exchange while allowing organizations and customers to retain appropriate control over sensitive information and infrastructure.

This type of trusted data environment is essential for integrating different flexibility resources.

Energy communities, commercial batteries, electric-vehicle fleets, industrial loads and other distributed assets all need to become visible within a wider system if they are to contribute meaningfully to network operation.

Without that visibility, flexibility remains fragmented.

Individual aggregators, utilities or technology providers may create successful business cases, but the broader market will continue to consist of disconnected pilots rather than an integrated national or European ecosystem.

Unlocking data is therefore not simply a digitalization issue.

It is a prerequisite for creating a marketplace in which different flexibility resources can participate, compete and provide measurable value to the network.

Ana:

Smaller-scale flexibility should not remain outside the market simply because individual resources are too small to participate independently.

Energy communities can provide the aggregation layer required to combine these resources.

This is especially important for small renewable generation, household assets and distributed demand-response resources that may currently be ignored by larger market mechanisms.

Allowing communities to aggregate and trade locally could create a progression from individual consumers, to energy communities, to larger flexibility markets.

Such a structure would allow resources to create value at the most appropriate level instead of requiring every participant to enter a national or wholesale market directly.

Regulation is critical because the technology needed to support this model already exists.

What is often missing is permission to use it at scale.

National regulators need to translate the possibilities created by European regulation into practical market arrangements that enable trading between communities, aggregation of small resources and secure participation by multiple service providers.

The combination of granular data, aggregation and supportive regulation could therefore allow smaller resources to contribute meaningfully to network management rather than remaining an unused source of potential flexibility.

Should DSOs and regulators focus first on unlocking data or on enabling local energy communities to provide flexibility?

Ana:

Unlocking data and enabling local energy communities should not be treated as competing priorities.

They are closely connected and, in practice, need to develop together.

Energy communities can already increase the value created by distributed assets such as rooftop solar.

However, communities continue to face limitations that prevent them from realizing their full flexibility potential.

One important step is enabling trading between communities.

Local trading could allow distributed renewable generation to be used more efficiently while creating additional value for households and communities.

Price signals are another important part of the solution.

Time-of-use tariffs and other dynamic tariff structures can encourage customers to shift consumption toward periods when electricity is more readily available or when the network has greater capacity.

Even relatively simple day-and-night tariffs demonstrate that price signals can influence consumption behavior.

More sophisticated tariff structures could allow DSOs to source flexibility precisely where and when it is required.

However, DSOs cannot make effective use of these mechanisms without interacting with the energy community and accessing the relevant data.

That means they must be able to communicate with whoever manages the community’s energy data and understand how much flexibility is available.

The technical capability to do this already exists.

The challenge is moving successful pilots into mainstream solutions that regulators, DSOs, communities and customers trust.

An interoperable flexibility registry could help provide this foundation.

Such a system could enable authorized providers to connect securely to distributed resources, support community trading and allow demand-response providers to participate without creating unnecessary technical barriers.

Ideally, these systems would eventually operate across wider national and European markets rather than remaining isolated within individual projects.

Elena:

Data should be treated as part of the long-term architecture of the flexibility market.

Rather than continuously responding to short-term regulatory changes, policy makers, system operators and market participants need a clearer understanding of the ecosystem they ultimately want to create.

Europe’s broader objectives of resilience, decarbonization and greater integration of renewable energy require flexibility to move beyond temporary pilot programs.

Data provides the foundation for that transition.

When distributed resources can be identified, measured and coordinated within trusted frameworks, national initiatives can begin replacing isolated projects.

The objective should therefore be to build ecosystems in which different actors can participate without having to surrender unnecessary control over their data or infrastructure.

A clear long-term strategy would also give technology providers, aggregators, DSOs and energy communities greater confidence to invest in solutions designed for scale rather than continuing to create separate systems for individual pilots.

Gerry:

Energy communities could play an increasingly important role in connecting distributed customer resources with the needs of the distribution network.

Ireland’s experience with microgeneration illustrates both the opportunity and the challenge.

Distributed generation can create significant value for individual customers, but when thousands of resources operate independently, their contribution to network capacity and congestion management can be difficult for the DSO to use.

Energy communities could change that.

By aggregating existing distributed resources, communities could transform individually small contributions into a coordinated flexibility product.

This would create additional value for community members while also creating a resource that the distribution network can use more effectively.

The necessary tools, data access and market structures therefore need to evolve together.

Energy communities should not simply be viewed as mechanisms for local generation or self-consumption. With appropriate aggregation, data access and DSO interaction, they could become an important component of the wider flexibility market.

Conclusion

Flexibility depends on trusted data and clear grid visibility. DSOs need to know where constraints are, when they happen and which resources can respond, otherwise flexibility cannot become a reliable part of planning and daily grid operation.

Flexibility should not be seen as a full replacement for grid reinforcement. It can help manage constraints and create time while new infrastructure is being built, but it needs enough participation from customers, aggregators and energy communities to become a credible option.

Local energy communities can play a much bigger role in flexibility markets. By combining small resources into useful flexibility products, they can support DSOs and create value for customers, but this requires better data access, interoperable systems and regulation that supports local trading.