How smarter markets can deliver value for consumers: Elexon at International Energy Week 2026
Summary
Elexon's CFO highlights that non-commodity costs rather than wholesale prices now drive consumer bill pressure, with Market-wide Half-Hourly Settlement progressing from 3 million to target 30 million meters. Smart meter penetration has reached 60-70%, enabling time-of-use tariffs and flexibility services.
Why it matters
This frames the market design challenge correctly — wholesale prices get attention but policy costs and capacity mechanisms drive bills. The call for stability over further reform suggests current mechanisms could work if allowed to mature without constant tinkering.
Key facts
- •Smart meter penetration at 60-70%
- •3 million meters migrated to half-hourly settlement targeting 30 million
- •Infrastructure investment must double for Clean Power 2030
- •Non-commodity costs identified as primary bill pressure driver
Areas affected
Related programmes
Memo
What this is about
Elexon CFO Steve Page used International Energy Week 2026 to reframe the energy transition debate around cost drivers that actually matter for consumers. While wholesale price volatility dominates headlines, Page argued that non-commodity costs — policy levies, capacity mechanisms, and network charges — now drive most bill pressure. This challenges the narrative that commodity price spikes are the primary consumer concern and positions market design improvements as the critical lever for affordability.
Page's intervention matters because it comes from the organisation running GB's electricity settlement systems as they undergo fundamental transformation. With Market-wide Half-Hourly Settlement (MHHS) migrating millions of meters and smart meter penetration hitting 60-70%, the technical infrastructure for demand-side flexibility is finally materialising. The question is whether market arrangements can translate this capability into consumer benefits without adding regulatory complexity.
Key points
Non-commodity costs dominate bill pressure. Page explicitly stated that policy mechanisms and overlapping capacity arrangements create more consumer cost pressure than wholesale price movements. This validates longstanding industry concerns about the cumulative impact of decarbonisation policies on bills, particularly when multiple capacity mechanisms operate simultaneously without clear coordination.
MHHS migration accelerating. Settlement reform has moved beyond pilot phase, with over 3 million meters already migrated toward the target of 30 million. This represents the most significant change to GB electricity market operations since NETA, creating half-hourly price signals across the entire customer base rather than just large industrial users.
Smart meter penetration reaches critical mass. At 60-70% penetration, smart meters have crossed the threshold needed for system-wide demand response. This enables time-of-use tariffs, automated demand shifting, and participation in flexibility services — the building blocks for consumer engagement with system balancing.
Infrastructure investment must double. Page confirmed expectations that achieving Clean Power 2030 and net zero requires doubling current investment levels. Rather than meeting this through pure network expansion, he positioned demand-side flexibility as essential for managing peak loads and deferring reinforcement costs.
Regulatory stability prioritised over reform. When asked for a single policy change, Page advocated for fewer changes rather than more mechanisms. This reflects growing industry fatigue with constant regulatory churn and suggests existing market arrangements could deliver if allowed to operate without continuous modification.
Flexibility as consumer benefit mechanism. Page framed demand-side flexibility not as a system requirement but as a route for consumers to reduce bills through smarter tariffs and service participation. This positions flexibility services as win-win arrangements rather than impositions on household behaviour.
What happens next
MHHS implementation continues through 2026-27, with Elexon managing the technical migration of remaining meters. The timeline suggests completion by late 2027, creating GB-wide half-hourly settlement for the first time. This will enable precise locational and temporal price signals, supporting both flexibility services and network investment planning.
DESNZ's Clean Power 2030 delivery plan will test Page's argument about investment doubling. If flexibility services can genuinely moderate network reinforcement needs, this should appear in distribution network operators' business plans and Ofgem's price control determinations. The Alternative to Connection framework provides the regulatory pathway for flexibility to substitute for network investment.
Page's call for regulatory stability faces immediate testing. Ofgem's ongoing reviews of capacity mechanisms, network charging, and market arrangements will determine whether the sector gets the regulatory pause Page advocates. The Challenge Programme examining wholesale market design represents exactly the type of fundamental reform Page suggests avoiding.
Consumer engagement through time-of-use tariffs depends on supplier willingness to offer differentiated pricing and household appetite for behaviour change. Early adopters of electric vehicles and heat pumps provide natural test cases, but mass market uptake requires tariff structures that deliver obvious savings without complexity.
The tension between investment requirements and consumer affordability will intensify through 2026. If non-commodity costs continue rising while wholesale prices stabilise, Page's framing becomes politically salient. This could drive pressure for policy cost rebalancing between different consumer classes or funding mechanisms.
Flexibility service markets need standardisation and scaling to deliver Page's vision of consumer benefits. Current arrangements serve large commercial users effectively but lack the simplicity and accessibility needed for mass residential participation. Aggregation platforms and automated demand response technologies become critical infrastructure for translating household flexibility into system value.
The global context Page referenced — energy transition assets as resilient investments — suggests continued capital availability for GB energy infrastructure. However, this depends on regulatory frameworks providing sufficient return certainty, reinforcing his argument for stability over constant reform.
Source text
At the International Energy Week 2026, Steve Page, Chief Financial Officer of Elexon, joined a senior panel to explore one of the defining questions of the global energy transition: where investment is flowing, who ultimately pays, and how markets can deliver value for consumers. Speaking on the panel “Where is the money going?”, Steve set out a clear message. While wholesale energy prices attract the most attention, much of the pressure on household bills now stems from non-commodity costs, including policy mechanisms, and overlapping capacity arrangements designed to ensure system resilience. “A lot of the messages we hear are about pressure on non-commodity costs. That is really causing pressure on bills for consumers,” Steve said. A pivotal moment for global energy investment Steve placed Great Britain at the heart of a global investment shift, describing the transition as a capital reality rather than a distant policy ambition. Energy transition assets, Steve noted, are increasingly viewed as resilient investments in a volatile global economy. Steve stressed that there is no single pathway. Different countries are pursuing overlapping transition routes shaped by national priorities, technologies, and regulatory frameworks. The challenge for policymakers and market designers is to ensure capital flows to outcomes that balance affordability, resilience, and decarbonisation. Smart meters enabling consumer participation Steve highlighted the smart meter rollout as a foundational milestone in enabling consumer engagement. “The rollout of smart meters is now up to 60 to 70 per cent penetration. That really has been a pivotal moment to enable consumers to get more involved in the energy market,” Steve explained. By providing accurate, timely consumption data, smart meters enable time-of-use tariffs, automation, and participation in flexibility services, all essential to managing system costs and helping households actively participate in the energy transition. Half-hourly settlement unlocking precise price signals A major reform now underway is Market-wide Half-Hourly Settlement, which will sharpen market signals and further refine settlement accuracy. “We have started the journey towards settling all those meters half-hourly, and at that point the degree of precision in the signals within the market will really ramp up,” Steve said. With more than three million meters already migrated on the path to around 30 million, this settlement will allow suppliers and the wider market to respond to real consumption patterns, driving smarter investment and consumer benefits. Managing network investment through flexibility Steve acknowledged the scale of infrastructure investment required to deliver net zero. “What we are expecting to see is that the amount of investment will have to double so that we achieve all of the aims under Clean Power 2030 and our path to net zero,” Steve said. Rather than relying solely on network expansion, Steve emphasised the role of flexibility in moderating these costs. By enabling consumers and businesses to shift demand, use storage, and optimise consumption, flexibility reduces peak loads and delays costly reinforcement. A smarter, more flexible system can deliver decarbonisation while protecting consumers from unnecessary cost increases. Stability and effective market mechanisms When asked what single change could best redirect capital, Steve offered a pragmatic response. “The one change that I would want would probably be not too many more changes,” Steve said. Steve argued that the energy sector already has a wide range of market mechanisms in place. The priority now is to allow them to operate effectively, refine price signals, and optimise outcomes rather than introducing continual reform that risks undermining investor confidence. Elexon is committed to clear, consistent market frameworks that enable participation and innovation. Consumers at the centre of the transition Throughout the discussion, Steve returned to the consumer perspective. Flexibility, Steve argued, is key to ensuring consumers feel the benefits of the transition. Through smarter tariffs, connected technologies, and participation in flexibility services, households can lower bills while supporting system stability. Delivering value in the energy transition Steve Page’s contribution to International Energy Week underscored a critical truth: the success of the energy transition will be judged not only by emissions reductions, but by whether it delivers affordable, reliable energy. By improving market design, enabling flexibility, and providing precise price signals, Elexon is helping to ensure that investment translates into tangible benefits for consumers. “Much of the pressure on energy bills comes from non-commodity costs. Our role is to enable flexibility so that consumers can feel the benefit, and these costs are managed more effectively,” Steve said. The post How smarter markets can deliver value for consumers: Elexon at International Energy Week 2026 appeared first on Elexon .