smartEn LCP Delta Reflecting on the Future (2026)

Title: Reflecting on the Future: Medium-term evolutions impacting the development of flexible demand. Written by LCP Delta for smartEn, September 2026; project management at smartEn by Michael Villa (Executive Director) and Quentin Donnette.

Who is behind it: smartEn is the European business association of the demand-side flexibility industry, and the study is sponsored by The Mobility House Energy, a battery and V2G aggregator. Both have a commercial interest in market-based flexibility and independent aggregation, which is the report’s conclusion. smartEn’s own disclaimer calls the paper “exploratory” and not a smartEn position; LCP Delta’s disclaimer says its projections are “illustrations of what might happen”, not predictions.

Method: a literature review of EU policy and market documents plus LCP Delta’s own data and forecasts, organised around five “system drivers” (regulation, markets, demand, generation, networks), followed by interviews with smartEn members. From these the authors build three qualitative scenarios for the EU in 2035 and answer each research question within each scenario. There is no model and no new quantitative evidence; scenario details (grid utilisation rates, renewable shares, dates) are narrative assumptions, not findings. Sweden is not covered specifically: the Nordics appear only among “leading Member States”, and Nord Pool as an example of advanced settlement.

Summary

The report’s premise is that the EU already has the legal architecture for demand-side flexibility (the Electricity Market Directive and its 2024 amendments, RED III, the Energy Efficiency Directive, the Network Code on Demand Response), but that implementation lags and varies between member states. It asks how the EU electricity system may look in 2035, how that changes the value of demand-side flexibility, and who carries the resulting signals to consumers.

According to the report, the explicit value that flexibility providers can capture today sits mainly in TSO ancillary-service markets. The scenarios differ in where that value moves:

The value split per scenario is shown only as charts (indicative shares based on expert input); the percentages are not in the extracted text.

Key claims

1. Markets are the destination but not the default. Open, liquid markets are the best coordination mechanism, but they compete in the near term with non-market tools that system operators use for grid security.
2. Fallback lock-in risk. NC DR sets a “flexibility first” direction, but whether it becomes a real hierarchy over non-market alternatives depends on national implementation. Relying on FCAs, tariffs and direct control gives system operators an immediate safety net while “starving emerging flexibility markets of liquidity”; system operators must be clearly incentivised to prefer markets.
3. Liquidity needs active support. Lower barriers to entry and standardised market access do not by themselves create participation or volume in early-stage markets.
4. Prioritise liquidity over perfect design. Early implementations should favour simple, low-friction access over complex rules; otherwise business cases fail and the non-market “crutches” persist.
5. Who mediates the signal. The report sets out three structures by who carries flexibility signals to consumers: system operators (limited market-based flexibility), retailers (remaining barriers for independent aggregators), or retailers and independent aggregators competing (a “competitive ecosystem”). It argues that the available volume of demand-side flexibility grows along that line. A well-functioning market in its definition has non-discriminatory access, sufficient volume, transparent near-real-time data and “granular products: bid sizes of 100 kW or less”.
6. Implementation gap today. Core provisions on dynamic pricing, independent aggregator access, market-based procurement and smart-meter roll-out remain unevenly transposed; the report states that in 2025 the majority of member states had not fully transposed independent aggregation into national law, and in its business-as-usual scenario describes lagging states that “may retain soft veto mechanisms” through complex notification procedures or missing compensation rules.

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