The Demand Flexibility Service (DFS) was launched following approval by the energy regulator Ofgem on 4 November 2022, according to the National Energy System Operator (NESO), which runs the scheme1. NESO states that the service "started with a simple goal: make it easier for homes and businesses to take part in the electricity market and be rewarded for shifting when they use electricity"1.
The service was launched in winter 2022/23 and was designed to help manage potential winter pressures by reducing demand during evening peak periods and reducing reliance on more expensive electricity generation1. NESO says its success was recognised across the industry, with awards at the Green Energy Awards and Utility Week Awards in 20231.
The scheme has since changed in scope and design. NESO lists the following dates:
| Date | Change |
|---|---|
| 4 November 2022 | Ofgem approval, associated with the DFS launch1 |
| 27 November 2024 | DFS became a year-round service and moved to operate as an in-merit margin tool1 |
| 9 April 2026 | Expansion with bi-directional flexibility, zonal procurement, a reduced eligibility threshold of 0.1MW, Primacy, and a Self-Nominated Baseline option1 |
| 7 October 2026 | DFS will launch the capability to procure constraint management actions1 |
NESO says the April 2026 changes "have made DFS more flexible and accessible to a broader range of assets"1. From 7 October 2026, flexibility providers will be able to participate in both margin and system tagged actions, and NESO will no longer procure constraint management actions through the Local Constraint Market1. NESO describes this as part of a wider objective to create a simpler, clearer and more scalable route to market, with margin and constraint actions brought together within a single service so providers can take part through a common operational framework1.
"The launch of the new Demand Flexibility Service following Ofgem approval on the 4 November 2022."
NESO publishes two tables of registered providers: one for domestic households and small businesses, and one for all other businesses, showing whether providers are members of the Flex Assure compliance scheme1. The page also sets out steps for organisations wishing to become registered providers, including contacting the DFS team, registering on the Single Markets Platform, completing an IT process check and submitting an online form1. The page does not state how many households have taken part in DFS events, how much participants have been paid, or what the service has cost.
Why it matters for households
The DFS is one of the routes by which a household with a smart meter can be paid for shifting electricity use away from peak times, typically the evening. Its origin date matters because it marks when the regulator first allowed the scheme to operate, opening the way for suppliers and other providers to sign up households. The changes since then affect who can take part and on what terms: the reduced eligibility threshold of 0.1MW recorded for April 2026 concerns the size of a participating unit rather than a single home, and the move to a year-round service means the scheme is no longer confined to winter. For a household, the practical effect of demand flexibility is that some of its electricity use becomes a resource the system can call on, which is a different relationship with the grid from simply consuming what is bought. The Ofgem: What the Energy Regulator Does and What It Covers page explains the regulator's role in approving such arrangements, and Energy Complaints and Redress: Ombudsman, Citizens Advice and Ofgem covers where households can take a complaint if something goes wrong with a provider. Wider regulation and policy changes of this kind set the terms on which household flexibility is bought and sold.
What happens next
NESO states that from 7 October 2026 the DFS will launch the capability to procure constraint management actions, and that it will no longer procure constraint management actions through the Local Constraint Market1. No further dated steps are given on the page.