Pent-up energy: takeaways from FLEXCON 2024

[00:00:04.520] - Jon Slowe

Welcome to talking new energy, a podcast from LCP Delta. I'm Jon Slowe.

[00:00:09.250] - Sandra Trittin

And I'm Sandra Trittin. And together we are exploring how the energy transition is unfolding across Europe through conversations with guests from the leading edge of the transition.

[00:00:19.550] - Jon Slowe

Hello, welcome to the episode. Today we have the first of our new ten-minute bite sized format from Talking New Energy, and we'll be focusing on key takeaways from FLEXCON, held last week in Amsterdam and Europe's biggest gathering of the demand-side flexibility sector to explore the takeaways. Two people that were there, my colleague Jon Ferris from LCP data and co-host Sandra Trittin. Hello, Jon.

[00:00:50.280] - Jon Ferris

Hello, Jon.

[00:00:51.420] - Jon Slowe

And hi, Sandra.

[00:00:53.010] - Sandra Trittin

Hello, Jon.

[00:00:54.790] - Jon Slowe

So, have you both recovered? Tiring few days, I imagine.

[00:01:01.230] - Jon Ferris

Very busy few days with lots of conversations with everyone in the flexibility industry, but really inspiring.

[00:01:10.990] - Jon Slowe

Inspiring. Good. How many people there roughly?

[00:01:14.170] - Jon Ferris

So, I think it was about 350 across the two days?

[00:01:18.040] - Sandra Trittin

Yes.

[00:01:18.950] - Jon Slowe

Yeah. Okay, well, let's dive straight into the takeaways. So, I'm going to ask each of you to give your top three takeaways from FLEXCON 2024. And let's go one. Let's go alternate takeaways. So Jon, what's your first one?

[00:01:39.470] - Jon Ferris

So, my first takeaway is that the flexible demand management industry is a thing now. This wasn't a gathering of start-ups like it was a few years ago. Yes, there was new start-ups there, but the start-ups from a few years ago are now becoming scale-ups, they're becoming established and incumbent companies were represented. So, as a marketplace, as an industry, it's much broader than it was just a few years ago.

[00:02:09.410] - Jon Slowe

So, no longer an emerging thing and a thing for the future. A thing for now, exactly. Yeah. Okay, that's your number one, Sandra, your number one.

[00:02:19.290] - Sandra Trittin

I think what I found really great to see is also the different appearances on how flexibility can be used and the different solutions that were present. And as Jon was saying, not only on a start-up level, but really with commercial applications and on the scaling level. So saying, for example, all the flexibility, which was focusing around on site optimisation, around self-consumption, et cetera, then also about local optimisation, more on a level like communities, but also like capacity sharing, which I found an interesting piece of it, but then also going to the national level, but instead, as having discussed ten years ago on the FCR ancillary services market, now everyone is going into the trading markets and into the intraday, day ahead continuous trading markets, which I find really exciting.

[00:03:18.410] - Jon Slowe

Okay. So not to think about flexibility as one thing, but an umbrella term, and within that all the different flavours of flexibility that are now on the market and emerging. Okay, Jon, number two.

[00:03:32.650] - Jon Ferris

Well, that actually leads very nicely onto my number two, which is the increasing need to coordinate that value, that there are lots of different entities across the system that can get value from flexibility, as Sandra says, whether it's in communities, ancillary services, wholesale markets, where negative prices were the talk of the event this year. Imbalanced markets, congestion markets and the value pool. Any individual value pool isn't enough to, to make the business case. So, everyone is looking at how they can participate in multiple markets, which also then means that how that value is coordinated across the markets is becoming much more challenging and much more important.

[00:04:21.070] - Jon Slowe

So, good in one way that there are many buyers or users of flexibility. That's great for people providing it. And I could in theory stack that on top of each other, but can they do that? And actually the coordination to avoid conflicting signals or people pulling in different directions.

[00:04:40.210] - Jon Ferris

We're a long way from the times where the enhanced frequency response or an FCR contract could give you one value stream and a long-term contract and be enough to make your business case.

[00:04:54.810] - Jon Slowe

Yeah. Okay, thanks, Jon. Sandra, your second takeaway?

[00:04:59.530] - Sandra Trittin

My second takeaway is also based on what Jon has said.

[00:05:04.550] - Jon Slowe

Uncoordinated.

[00:05:05.830] - Sandra Trittin

Exactly. So, we are really building up that nicely. I think it's much less anymore around technical feasibility, the discussions, it's much more around how to execute and how to build business models, which makes sense to the consumers, which makes sense to the industry stakeholders and to the community. So, there were quite some interesting discussions going on because they look also different in different geographies, which is driven by the different culture of the consumer, which might be driven by regulation. But it's much more focusing now on how to get to the money, to the value, to the impact, but also how to distribute it back to everyone who is involved and how to build that chain in one and the other direction up.

[00:06:00.770] - Jon Slowe

So, those business models, those commercial models. Yeah, yeah. Not technically. Can it work?

[00:06:06.640] - Sandra Trittin

Exactly.

[00:06:07.600] - Jon Slowe

Yeah, yeah. And on to number three for each of you. Jon, what's your third takeaway?

[00:06:14.890] - Jon Ferris

Well, I wish I'd known what Sandra's were before noting my three, because my third is around customer propositions and the need to balance cost reflective compensation for the customer. So, dynamic tariffs or payment for performance is some simplicity and engagement with the mass market. The value in, particularly in the wholesale market, is challenging. That simplicity where it's hard to know if it's going to be the retailer or an aggregator or even the EV OEM or chargepoint operator, that is trading that value, that asset in the intraday or day ahead markets. And the final point on simplicity is can we decide whether we're calling them aggregators, VPPs, VLPs, BSP's, CSP's, please.

[00:07:18.380] - Jon Slowe

So, simplicity around customer propositions. Because without that, I don't think it will scale and simplicity around. I remember a bit in the e mobility sector still, all the acronyms about CPOs, electromobility, service providers, a lot of those are still there. But yeah, let's consolidate the terminology a bit.

[00:07:42.590] - Jon Ferris

Consumers to be engaged and not put them off with complexity.

[00:07:49.640] - Jon Slowe

Yeah. Sandra, your last one.

[00:07:53.510] - Sandra Trittin

My last one. What I found as the last point interesting is that there are some newcomers pushing into the flexibility market or into the topic, which is on one side, newcomers in terms of geography. So, there were some people, for example, from the US present and looking into the European market. And there is now continuous interest coming from other geographies getting into the European flex market. But there are also companies now which are not necessarily from the energy industry, more from being technology providers or telecommunication providers who are looking into that topic to develop some new solutions or new impact pathways for their core business.

[00:08:52.160] - Jon Slowe

That's actually, if you think of what we talked about at the beginning of going from, it's definitely not start-up and innovation, it's now scale-up and commercial. Maybe that's not a bad strategy to come into the market now. A lot of the hard work to establish it has been done. Okay. It sounds like this sector is really growing up very fast, but there's still quite a lot more to do in the last minute. One word to describe the mood at FLEXCON. What would each of you pick? Was it people unhappy about regulation? Was that the dominant mood? Were people excited? What word would you use? Jon, what would you say?

[00:09:47.550] - Jon Ferris

That's a really good question. I think there's a lot of pent-up energy just waiting to be released. So, that's not one word, but we're moving out of the pilot phase. But the flexibility industry is not yet business as usual at scale. We're just waiting for that release.

[00:10:13.290] - Jon Slowe

I like that. Pent-up energy. Go with that, Sandra.

[00:10:17.600] - Sandra Trittin

Yes, and I actually, I would join Jon on that one because you see all the motivation, you see all the dedication of the people. Everyone is pushing hard, but it's not pushing through, right. It's not fully there yet. And I think this is something that we would see within the next one or two years, hopefully to be discussed at FLEXCON around the scaling. Then in commercialisation.

[00:10:46.120] - Jon Slowe

So, definitely a lot of hard yards being done in the flexibility demand management industry, and a lot of exciting years to come as it scales up and all that hard work comes to fruition and gets unlocked. Jon, Sandra, thanks very much for sharing and hope everyone listening that gave you a flavour of FLEXCON 2024 and we'll be talking more about flexibility in future talking new energy episodes. Thanks very much and goodbye.

[00:11:16.920] - Sandra Trittin

Thank you. Thanks for tuning in. We are excited to bring you captivating conversations from the leading edge of Europe's energy transitions. If you got suggestions for topics or guests for future episodes, please let us know.

[00:11:31.490] - Jon Slowe

And if you're enjoying the podcast, then please do rate it and share it with colleagues. For show notes, transcripts, and more, please visit lcpdelta.com.