The energy transition cannot happen without flexibility!

Why energy flexibility is the backbone of the renewable grid

As Europe accelerates its transition to renewables, the challenge of intermittency is becoming increasingly urgent. Solar and wind power are abundant, but not always available when needed. In 2023, approximately 6% of all renewable energy produced in Europe was wasted due to grid constraints and lack of flexibility solutions (Ember Climate, 2024). 

Energy flexibility is the ability to shift, store, and optimize energy use across time and space, and it is emerging as the critical enabler of a resilient, decarbonized grid for the entire continent. Flexibility allows grid operators to:

• Balance supply and demand in real time, helping prevent blackouts and wasted energy.
• Reduce reliance on fossil-based plants, supporting decarbonization goals.
• Integrate distributed energy resources (DERs) more efficiently, enabling greater renewable penetration.
• Unlock new revenue streams for consumers and aggregators.

In short, energy flexibility is not just a technical upgrade, but a strategic lever that will determine the pace and success of Europe’s energy transition. We can add that without it, Europe faces significant risks and missed opportunities:

• Costly Blackouts: Europe experienced several major outages in 2025, with single events costing up to €4.5 billion in economic losses (Reuters, 2025).
• Investment Gap: Goldman Sachs estimates that Europe needs to invest €3.5 trillion in the energy sector by 2035 in order to avoid crisis and modernize grids for renewables and electrification. Also, Europe’s transmission system operators face a €250 billion shortfall in planned grid investments through 2030 (Smart Energy International, 2024).
• Wasted Opportunity: According to SmartEn, fully activating demand-side flexibility could save Europe €29 billion per year (SmartEn, 2023). 

North vs. South: A geographical gap in flexibility maturity

Northern Europe has set the benchmark for energy flexibility, thanks to early investments in digital infrastructure and supportive policies. Countries like Sweden, Finland, Denmark, and the Netherlands completed nationwide smart meter rollouts as early as 2014, reaching smart meter penetration rates above 90% (Berg Insight, 2024). This foundation enabled the Nordics and the UK to develop mature demand response markets, with both households and industries alike actively balancing the grid since the early 2010s (European Commission, 2023). 

The region’s leadership is reflected in its startup ecosystem: In 2023, Germany, Sweden, Denmark, and the Netherlands together attracted over $20 billion in climate tech venture capital (TechFundingNews, 2023), fueling innovation in energy flexibility and grid optimization. 

In contrast, Southern Europe is catching up, with smart meter penetration below 70%, and regulatory support for flexibility emerging mostly after 2020 (Berg Insight, 2024). While market participation and startup activity remain lower, momentum is building through national energy plans, EU funding, and a rapid rise in energy communities.

Mapping the European GridTech ecosystem

The European energy flexibility landscape is shaped by a dynamic ecosystem of technology companies, each tackling a distinct challenge in the transition to a smarter grid.

1. Flexibility Asset Aggregators focus on maximizing the value of energy assets, such as batteries, solar panels, and industrial loads by forecasting, optimizing, and trading their output in real time. Companies like Flower, Podero, Tibo Energy, Bamboo Energy, and GridX are leading this space, helping operators and consumers participate more actively in energy markets. 
2. Residential Flexibility Enablers empower households to contribute to grid stability by aggregating and controlling devices like heat pumps, electric vehicles and air conditioners. Startups such as Beebop, Sourceful Energy, and Emulate are turning everyday appliances into virtual batteries, allowing residential users to unlock new value from their energy consumption.
3. Digital Aggregators & Market Enablers connect distributed energy resources and facilitate their participation in flexibility markets. Platforms like Enspired, Electron, Fever, and Enode provide the digital infrastructure needed for aggregators and communities to trade flexibility, coordinate resources, and access new revenue streams.

Focus Portfolio: enspired

Among the most promising startups in the flexibility space is enspired, a Vienna-based company that operates a fully digital trading platform for flexible energy assets. Enspired enables asset owners, such as battery operators, industrial consumers, and aggregators to monetize flexibility by participating in intraday and balancing markets.

Key differentiators:
- AI-driven trading algorithms that optimize every move.
- Real-time market access across Europe.
- Seamless integration with existing asset management platforms.

Enspired’s model exemplifies the shift from static energy consumption to dynamic, market-responsive behaviour. It’s not just about storing energy, but knowing when and where to deploy it for maximum value.

“As first movers for algo trading and asset optimization in Europe, at enspired we have been devoted to bringing more flexibility to the power markets since day one. Flexibility is the backbone of the energy transition, and our technology is the key to unlocking its full potential.” says Juergen Mayerhofer, CEO & Co-founder of enspired.

Our View

Energy flexibility is not a niche, but the foundation of a net-zero energy system. Nowadays, we observe several players gaining traction within their national borders. However, international expansion remains challenging due to the fragmented structure of energy markets and regulatory frameworks across Europe. In the coming years, we expect that the companies able to adapt to this heterogeneous landscape and equipped with the resources to scale across multiple geographies will be the ones to lead and shape the future of energy flexibility.To investors, utilities, and policymakers, our message is crystal clear: the energy transition cannot wait, and everyone has a role to play.

‍

sources:

Ember Climate (2024) – Europe curtailment 2024 - https://ember-climate.org/insights/research/europe-curtailment-2024/ ‍

Reuters (2025) – Spain’s power generation nearly back to normal after Monday blackout, says grid - https://www.reuters.com/world/europe/spains-power-generation-nearly-back-normal-after-monday-blackout-says-grid-2025-04-29/ 

SmartEn (2023) – Flexibility Report 2023 - https://www.smarten.eu/wp-content/uploads/2023/06/SmartEn-Flexibility-Report-2023.pdf 

McKinsey – How Europe can accelerate smart grid penetration - https://www.mckinsey.com/~/media/mckinsey/dotcom/client_service/EPNG/PDFs/McK%20on%20smart%20grids/MoSG_Europe_VF.ashx

Berg Insight (2024) – Europe’s smart meter penetration - https://www.smart-energy.com/industry-sectors/smart-meters/europes-smart-electricity-meters-penetration-approaching-two-thirds/ 

European Commission / JRC (2023) – Demand Response Status - https://www.europarl.europa.eu/RegData/etudes/STUD/2025/769347/ECTI_STU%282025%29769347_EN.pdf 

TechFundingNews (2023) – Climate tech VC investment - https://techfundingnews.com/from-fuel-cells-to-ai-meet-10-european-startups-championing-net-zero-transition/ 

European Parliament (2025) – Increasing Flexibility in the Energy System - https://www.europarl.europa.eu/RegData/etudes/STUD/2025/769347/ECTI_STU%282025%29769347_EN.pdf