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Governance scenario

DSO Flexibility Procurement

A DNO transitions to DSO capabilities and must procure flexibility services. Incumbent flexibility providers allege the DNO is favouring its own network solutions. Market neutrality is questioned.

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This is a fictionalised teaching scenario grounded in real institutional roles, published reforms, and current public-source context.

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DSO Flexibility Procurement

Step 1 of 2

Flex Providers

Flexibility providers raise concerns

Thames Valley Networks is procuring flexibility to manage a constrained primary substation. They received bids from three providers but chose to reinforce the network instead, citing 'whole-system cost'. Flexibility providers allege the cost comparison was biased toward network solutions. They claim the DNO did not properly value optionality and carbon benefits of flexibility.

What is at stake

  • -If DNOs always choose network over flexibility, the market will not develop.
  • -If you force DNOs to buy flexibility when reinforcement is cheaper, consumers pay more.
  • -If procurement processes are not transparent, trust collapses.

How do you respond to the complaint?

Current Metrics

System Security70
Affordability60
Net Zero Progress55
Customer Protection65
Operational Efficiency58
Stakeholder Trust54

Actors Involved

UKPNFlex ProvidersOfgemCitizens

Regulatory Context

DSO Capability Maturity Framework

Governance relationship map

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Operating loop breadcrumb

Governance→Planning→Operations→Outcomes→Evidence

Current focus: Rules and accountability

Legend

Governance and policy

Rules, remits, and accountability

Planning and investment

Connections, queue progression, and delivery planning

System operations

Real-time balancing and network operation

Market and consumer outcomes

Prices, settlement, reliability, affordability

Evidence and learning

Telemetry, assurance, and continuous improvement

Glossary

  • Dispatch

    Real-time instructions to increase or reduce generation or demand so supply stays in balance.

  • Balancing

    The continuous process of matching electricity supply to demand while maintaining system frequency.

  • Constraint

    A technical limit in the network that restricts how power can flow under current conditions.

  • Industry code

    A formal rulebook that defines obligations and processes for specific market and network activities.

  • Connection agreement

    The formal agreement setting technical and milestone conditions for connecting a project to the network.

  • Settlement

    The process that turns metered and contractual positions into final market cashflow outcomes.

  • Conformance gate

    A quality checkpoint that verifies whether data or implementation meets agreed standards.

  • LTDS

    Long Term Development Statement publication requirements for distribution network data.

Guided tour

Step 1 of 8

Who sets the rules?

Start with governance: policy direction, regulatory oversight, licences, and code obligations.

Why it matters: Newcomers should first understand where authority sits before interpreting operational decisions.

Open Ofgem licence and code guidance

Preparing system graph…

Use this map to keep scenario decisions anchored to policy, coordination, operational delivery, and evidence feedback relationships.

Sources and methodology

How this page was assembled

Scenarios are designed as regulator-safe teaching runs. Institutional roles, programme context, and cited reform pathways stay grounded in current public sources, while event details and numbers inside the run remain fictionalised unless explicitly evidenced elsewhere. This scenario is framed against DSO Capability Maturity Framework.

Last reviewed 18 March 2026

Primary sources

Ransford's Notes