Source - Powernaut Flex Trends Report (2026)

Full citation: Powernaut (Florentijn Degroote, CEO). Flex Trends Report 2026. Powernaut, 2026. Commercial industry report. Available at powernaut.io.

Format: Interview-based industry report. Eight practitioner contributors representing 20+ GW of assets across European energy companies. Three trend chapters, each built around 2–4 expert interviews.

Contributors and affiliations:

Lars Herre PhD — Lead, Flexibility Portfolio & AI, Fortum
Jill Huber — Business Developer Power Flexibility, BKW
Jens Rombouts — Advisor, Vlondr (energy & flexibility strategy)
Hanns Koenig — Managing Director EMEA, Aurora Energy Research
Mustapha Obalanlege PhD — Energy and Financial Risk Manager, Sonnedix
Vijandren Naidoo — Head of BESS, Sonnedix
Peter Molenaar — Head of PMC & Flex Services, Eneco
Sebastian Himpler — Head of Energy Management, Enovos Luxembourg

Stored in: Powernaut Flex Trends Report 2026.pdf

What this source is

A practitioner-facing industry trends report by Powernaut (a European flexibility software platform company). Not peer-reviewed and not regulatory. Structured around three themes: multi-VPP coordination, colocation and behind-the-meter portfolio optimisation, and value chain consolidation. Geographic scope: pan-European (Switzerland, Germany, France, Netherlands, Portugal, Luxembourg) with Nordic perspective from Fortum. Useful for commercial architecture patterns, emerging contract structures, and on-the-ground observations about what is and is not working — not as an authoritative source for regulatory or market design claims.

Trend 1 — Multi-VPP integration and pool architecture

Fortum: pool architecture hierarchy

Lars Herre (Fortum) articulates a practical alternative to nested VPP terminology. Instead of “VPPs within VPPs,” he proposes a pool-based architecture:

Individual asset classes (EVs, heat pumps, HEMS) are managed as separate pools by specialised aggregators
Pools roll up into a single VPP layer inside the utility
The utility retains final aggregate control; individual asset management is delegated to pool managers
The whole stack sits under one BRP

Information flow: pool aggregators generate energy forecasts → BRP runs optimisation → returns aggregate load curve → utility disaggregates for pool-level implementation.

This architecture establishes a clear hierarchy (pool → aggregator → VPP → utility → BRP) with well-defined handoff points, reducing the “cognitive overload” of multi-VPP language while preserving the layered commercial structure. Multiple European utilities are described as already adopting variations of this.

BKW: modular VPP and end-to-end BSP responsibility

Jill Huber (BKW) describes the challenge of integrating heterogeneous assets (batteries, PV, industrial loads) into scalable, economically viable solutions. BKW operates simultaneously as BRP, BSP, and offtaker across multiple European markets.

Key architecture principle: separation of responsibilities with well-defined interfaces. BKW either delivers fully integrated optimisation or orchestrates specialised partners, but always retains responsibility for market access, balancing, and overall optimisation logic.

Cross-market complexity (Switzerland, Germany, France): each market has different regulatory dynamics. Switzerland’s single-price balancing introduction (2026) is shifting value toward intraday optimisation. Germany offers depth but intense competition. France: rapid growth in large-scale batteries is leading to saturation in ancillary services — cited as an early warning for other markets. (Source - Powernaut Flex Trends Report (2026))

Trend 2 — Colocation and behind-the-meter portfolios

Grid access as the primary colocation driver

Aurora’s Hanns Koenig identifies a structural shift in why colocation happens: grid access, not pure economics, is the dominant driver. In many European countries, obtaining a new standalone grid connection for a battery is effectively impossible; adding storage to an existing solar site is feasible even where charging is restricted to solar-only.

Five practical drivers for colocation (from Sonnedix’s Obalanlege):

Single grid access point — reduces permitting time and queue exposure
Shared maintenance supply chains
Ability to charge batteries directly from on-site generation
Easier land acquisition adjacent to existing sites
Maximum optimisation optionality across revenue streams — reduces capture price risk, curtailment, and negative price exposure

Tolling agreements

~20 tolling agreements signed across Europe. Emerging as the dominant commercial structure as BESS merchant risk makes banks uncomfortable, creating demand for parties willing to absorb that exposure. Tolling structures allow battery developers to offer guaranteed capacity access without exposing the offtaker to complex optimisation risk. Hybrid PPAs (combining renewables + battery in a single contract) remain rare due to the incomprehensibility of full battery optimisation to most corporate offtakers.

Ownership fragmentation as the behind-the-meter barrier

The biggest obstacle to effective behind-the-meter optimisation is fragmented ownership: sites where land, PV, battery, industrial operations, and EV charging are each held by different parties. Joint optimisation across multiple owners creates legal, commercial, and operational complexity — described as a “total nightmare.” Resolution: either single ownership or pre-installation alignment agreements before assets are installed. Building owners are increasingly investing directly into renewable assets (rather than leasing roof space) as a consolidation response.

Flexible connections as operational reality

Vijandren Naidoo (Sonnedix) describes live experience from one of Portugal’s first utility-scale batteries: grid charging restrictions apply during certain hours; no established grid code for batteries exists; TSO technical specifications are lagging. Flexible connection agreements are becoming standard but impose revenue model adjustments that many BESS developers did not anticipate in original business cases. The grid cannot be assumed as a static input to business case modelling.

Trend 3 — Value chain consolidation and verticalisation

Bidirectional movement

Peter Molenaar (Eneco) characterises verticalisation as happening at every link simultaneously: OEMs taking on installation, installers moving into EMS steering, EMS providers pushing into aggregation, aggregators eyeing trading. Not only large retailers moving upstream or IPPs downstream.

The data model barrier

Sebastian Himpler (Enovos) identifies an underrated internal barrier to verticalisation: traditional utilities identify customers by delivery point and address; flexibility trading requires identifying physical assets for aggregation. Transforming the internal data architecture from consumer identification to physical asset aggregation is the foundational challenge that most companies have not yet solved.

Short-term trading floor as a higher-than-expected barrier

Operating a 24/7 trading floor requires: significant cash reserves and regulatory infrastructure; 8–9 FTEs; access to an extremely tight and expensive labour market for short-term trading specialists. With 87% of orders now API-placed, manual trading is no longer viable. Consolidation in flex marketing is expected to follow the German direct marketing pattern: initial boom → margin compression from current ~7–8% gross margin → few dominant platforms.

Three consolidation scenarios (Rombouts / Vlondr)

Large integrated retailers (Engie, Luminus, Eneco) extend across the full value chain
Outside capital from disrupted industries (Shell/Next Kraftwerke as precedent)
New disruptors following the Octopus Energy model

Rombouts notes that capital is not the constraint — funding is available. The real constraint is execution: integrating across the value chain without the complexity overwhelming operations.

Relevance to existing wiki pages

Aggregation: pool architecture hierarchy; data model transformation challenge; verticalisation as multi-directional; BKW modular VPP design
Energy Storage: grid access as colocation driver; tolling agreements; FCR saturation in France as early warning; Portugal flexible connection experience
Flexible Connection Agreements / Villkorade Avtal: Sonnedix Portugal as a live BESS operator example of FCA operational reality; grid code lag for batteries
Synthesis — The Swedish BESS Business Case: France ancillary services saturation corroborates the FCR saturation thesis for Sweden

Limitations

Commercial publication by a software vendor with a market interest in European flexibility development. Not peer-reviewed. Qualitative interview-based; no quantitative data on market sizes or financial returns. Pan-European scope — claims about specific market structures (France saturation, Switzerland single-price balancing) are asserted without primary data citation. Views represent individual practitioners at specific companies, not industry-wide surveys.