The flexible business: why energy flexibility is becoming a finance issue

As Britain adds more renewable generation and electrifies more transport, heat and industry, the value of electricity will increasingly depend not only on how much is available, but when. The scale of the change is significant. Consumerled flexibility is expected to grow from around 2.5GW to 10-12GW by 2030,[1] while the Government has set an ambition for grid-scale battery capacity to increase from just over 6GW to 23-27GW over the same period.[2]

There is a financial reason for that growth. Government estimates suggest that flexibility and storage could save the electricity system up to £10 billion a year by 2050 by reducing the amount of additional generation and network infrastructure that needs to be built.[3]

For businesses, that creates a fairly simple commercial question: if we have some control over when we consume, store or generate electricity, what is that control worth?

This is the part I find most interesting from a finance perspective. A business that can shift some demand away from expensive periods has an option that a business with completely fixed demand does not. Add batteries, onsite generation or a large EV fleet and the number of options potentially increases.

Those options can create value in different ways: avoiding higher-cost periods, reducing exposure to certain non-energy costs, making better use of onsite generation, or earning revenue by making flexible capacity available to energy markets.

And this is already generating measurable returns. In an EDF trial with six large business customers, participants provided an average 8.6MW of flexibility during events and made combined savings of around £285,000 over the five month trial.[4]

This isn't the same as energy efficiency. Efficiency asks how we can consume less. Flexibility asks whether we can consume differently, and whether doing so has a financial value.

I started to think about flexibility differently when I stopped looking at it as an energy concept and thought about it in terms we use in Finance all the time: exposure, options and value. If a business has choices about when it uses energy, that can change both its costs and its risk.

This is where flexibility should become particularly relevant to CFOs.

Consider a battery. A conventional investment case might compare its capital cost with the savings it generates and calculate a payback period. But the return can come from several different places.

One industrial and commercial battery installation optimised by EDF, for example, generates around £380,000 a year in combined revenue and savings against an upfront investment of £1.0 million, giving a projected payback of three years. Its value comes from a combination of wholesale trading, non-energy cost savings and ancillary services.[5] That's the interesting part from a Finance perspective. It isn't one saving or one revenue stream.

The same principle applies beyond batteries. EV charging, onsite generation and flexible industrial processes can all change the shape of a company's energy demand and therefore its exposure to energy costs.

This doesn't mean these investments automatically make financial sense. Every site and asset is different. It means the investment case needs to capture all of the value they can create. A project can look unattractive when assessed against one saving and quite different when several sources of value are considered together.

And there is another complication. The people assessing the EV fleet may not be the people buying electricity. Operations may control when equipment runs, Sustainability may own onsite generation, and Finance may see each individual business case without anyone assessing how the pieces interact. For CFOs, the opportunity is to join that value together.

The financial case isn't only about return on investment. Flexibility can also affect exposure. Businesses have traditionally managed energy-price risk primarily through procurement and hedging. Greater operational flexibility potentially adds another tool.

If some demand can move in response to price, the organisation is less passive. If electricity can be stored, the business has choices about when it draws from the grid. If it generates some of its own power, the relationship changes again.

None of these removes energy-market risk. But they can change the nature of theorganisation's exposure to it.

For a CFO, that raises a more useful question than simply, "What return will this asset generate? "What combination of return, avoided cost and reduced exposure does it create, and what is that worth to us?

I don't think finance leaders need to become experts in electricity markets. But there are three questions worth asking:

1. Where do we already have flexibility?
2. Which loads, processes or assets could genuinely change when they consume power without compromising the business?
3. What are we about to electrify?

Decisions about fleets, heating, production and infrastructure will shape the organisation's electricity demand, and its exposure to energy costs, for years.

Then, are we capturing the whole financial case?

When we assess energy-related investment, are we looking across avoided cost, potential revenue, risk and future optionality, or is each benefit being assessed separately?

The energy transition is often discussed in terms of how Britain will generate enough clean electricity. The other side of that equation deserves just as much attention: how intelligently we use it.

For businesses, flexibility turns that from an energy-system debate into a financial one. And that's why it belongs on the CFO's agenda.

Ceri Humphrey is Finance Director at EDF, working across EDF's UK Customers business. She brings a finance perspective to the opportunities and challenges created by the energy transition, including how businesses can approach investment, risk and value as the energys system becomes increasingly flexible and electrified.

[1], Department for Energy Security and Net Zero, Clean Power 2030 Action Plan: A new era of clean electricity, December 2024. Consumer-led flexibility capacity of 2.5GW in 2023,  with a 10-12GW Clean Power Capacity Range for 2030.Clean Power 2030 Action Plan 

[2],[3], Department for Energy Security and Net Zero, Statutory Security of Supply Report 2025. Government ambition for 23-27GW of grid-scale batteries by 2030, up from just over 6GW. Statutory Security of Supply Report 2025 

[4] EDF, Our business customers save cash and carbon by providing energy flexibility, June 2024. Six participating large business customers provided an average 8.6MW during each event and achieved combined savings of around £285,000 during the November 2023 to March 2024 trial. EDF: Our business customers save cash and carbon by providing energy flexibility

[5] EDF, The Power of Flexibility: Why batteries are central to a smarter energy future, May 2025. Example of an industrial and commercial battery installation generating around £200,000 per year in revenue and savings against £1.2 million CAPEX, with a projected seven to eight year payback. EDF: The Power of Flexibility

^{*the views expressed are the author’s and not ICAEW’s}