The energy market in the UK is evolving radically with `prosumers' increasingly engaged in generation, flexibility and supply of their own energy. All this activity is having a direct impact upon the operation and design of the network. Distribution Network Operators (DNOs) can make use of this flexibility to develop a grid modernisation strategy that takes account of the cultural shift in how energy is generated and consumed; consequently securing the provision of affordable, reliable and safe power within an electrical grid that is dominated by distributed energy resources and multiple fuel technologies.
Project FUSION will allow DNOs to make use the inherent flexibility that is available within a region by implementing a whole system approach across multiple energy vectors (transport, heat, gas electricity). This will be developed within a fixed frame of network parameters and demonstrate how flexibility across each energy vector can be optimised as part of a services market, to mitigate network constraints and provide a valid alternative to conventional network reinforcement and enable an agile market which can accommodate for future uncertainty in regional development.
The project will engage with multiple industry participants and stakeholders to realise the value of their flexibility by implementing an open access commercially structured market place which will allow multiple energy users to offer demand or generation services to the DNO to alleviate network issues in real time and reduce network losses.
Objectives
Project FUSION will implement the Universal Smart Energy Framework (USEF) across North East Fife as a new open access market place for flexibility. The Framework has been developed as an international standard to deliver a universal market for flexibility and has been successfully trialled in the Netherlands.
However, the user device interface (UDI) and commercial framework have not been proven within the GB market and consumer context. Therefore, the project will develop USEF so that it is fit for purpose within the UK. This includes establishing the interface between USEF and each participant that is active within this flexibility market (network operators, suppliers, aggregators, flexible demand customers) and the commercial arrangements that facilitate a settlement process showing that flexibility products can be delivered reliably as specified and as scheduled.
Prior to the network trial the USEF commercial framework will be developed to take account of the market structures and algorithms within the GB market context. This includes the methodologies and safeguards specific to the GB market and regulatory framework to facilitate effective competition in flexible user price submissions and avoid market abuse; as well as demonstrating the safeguards to ensure that 3rd party procurement of flexibility does not result in unacceptable loading on the distribution network.
Once USEF has been adapted and is fit for use within the UK a network trial will demonstrate how a multi vector approach can provide valuable network flexibility by incentivising customers to provide the network with the flexibility its requires to alleviate network strain and defer expensive reinforcement. The trial will coordinate an array of LCTs across North East Fife in real time in partnership with USEF to show how traditional reinforcement can be avoided by peak shaving electrical demand by making use alternatives supplies of energy. For example, the provision of the gas network to alleviate the peaks in demand caused by the electrification of heat and transport.
Alongside the project, the local distribution network within North East Fife will be equipped with adequate monitoring to enable SPD to identify network issue in real time and request the required flexibility from the USEF market place. This will be a staged approach by identifying priority circuits which include customers and aggregators with the adequate flexibility that can be offered to the DNO.
Learnings
Outcomes
he project successfully delivered a comprehensive demonstration of a local flexibility market within a real distribution network environment and achieved its core objective of validating the use of flexibility as an alternative to traditional network reinforcement.
A key outcome was the successful operation of flexibility market processes, including procurement, contracting, dispatch, and settlement. These processes were tested through both live and simulated scenarios, confirming that flexibility can be reliably sourced and utilised to support network operation. The project demonstrated that distributed energy resources are capable of responding to network requirements, providing confidence in their role within future energy systems.
In terms of performance improvement, the project showed that flexibility services can contribute to more efficient network management by providing an alternative to reinforcement, supporting improved utilisation of existing assets. The trial also demonstrated improved coordination between the network operator and market participants, validating the effectiveness of structured market mechanisms.
The project produced measurable outcomes in relation to market participation and flexibility delivery, although volumes were lower than originally anticipated. Despite this, sufficient activity was achieved to validate key processes, test system interactions, and generate robust learning across technical, commercial, and operational aspects.
A significant outcome was the advancement of the Technology Readiness Level (TRL) of the flexibility market concept and the USEF-based approach. Through the transition from design and simulation to live demonstration, the project moved the method closer to real-world application, showing that it is feasible and increasingly ready for adoption, with further refinement.
The project also generated valuable outputs in areas such as:
- Market coordination mechanisms
- Flexibility trading processes
- Baselining and performance measurement approaches
- Data exchange and system integration
These outputs provide a strong foundation for future development and industry adoption.
Lessons Learnt
The project provided valuable insights that can support the successful delivery of future flexibility and innovation initiatives. The approach taken proved effective in demonstrating how a flexibility market can operate within a real distribution network, while also identifying opportunities to enhance future projects.
One key lesson is the importance of keeping market processes clear and practical. The project showed that well-structured and transparent procurement, contracting, and coordination processes help participants engage more confidently and efficiently. Future projects can build on this by further simplifying and standardising these processes to support wider participation and smoother operation.
The project also reinforced the value of early and continuous stakeholder engagement. Strong collaboration with aggregators and flexibility providers helped shape the trial and ensured that participants could engage with the market framework. Future projects can benefit from maintaining this approach, while further strengthening communication and awareness to maximise participation and available flexibility.
Another useful learning is the need for flexible trial design. By adapting to varying network conditions, including the use of both live and simulated scenarios, the project was able to fully test key processes and generate meaningful results. This demonstrates the benefit of designing projects that can respond to real-world conditions while still achieving their objectives.
The research and demonstration activities were effective in validating the concept of flexibility markets. The project confirmed that distributed energy resources can respond to network requirements and that coordination between different parties can be successfully achieved. This provides a strong foundation for future development and wider adoption.
In addition, the project highlighted opportunities to further enhance areas such as baselining, data exchange, and system integration, supporting continuous improvement and innovation. These insights help ensure that future projects can build on proven foundations while advancing towards more scalable solutions.
Overall, the project successfully delivered its intended learning outcomes and demonstrated a practical pathway towards integrating flexibility into business-as-usual operations, providing a positive and constructive platform for future innovation.
