Energy smart appliances, such as EV chargers that top up overnight when electricity is cheapest, heat pumps that flex around grid demand, and home batteries that discharge at peak times, are becoming central to the UK's net zero strategy. As the number of companies remotely controlling household electricity demand increase in the face of consumer-led flexibility, the government has identified a clear need for a dedicated regulatory framework to ensure adequate consumer protection, cyber security, and grid stability.

On 7 August 2026, Ofgem published its consultation decision setting out how a new load control licence will work in practice. The regime, developed under the Smart Secure Electricity Systems (SSES) programme in collaboration with the Department for Energy Security and Net Zero (DESNZ), marks the first time that the activity of remotely controlling domestic electricity demand will be subject to its own licensing framework.

Subject to Parliamentary approval, Ofgem expects the underlying regulations to come into effect by 1 March 2027, with the requirement to hold a licence coming into effect by March 2028 after a 12-month transition period. After the transition period ends, carrying out licensable activities without a licence will become an offence.

Here is what prospective licensees need to be aware of before then.

What will be licensed?

The regime targets two activities, each of which creates different compliance requirements for licensees:

• Flexibility Service Providers (FSPs), which offer flexibility products directly to consumers; and 
• Load Controllers, which send signals to domestic-scale devices, such as private EV charge points, heat pumps, and home batteries, to shift demand patterns. 

Ofgem has introduced three tailored application routes depending on whether the applicant already holds an electricity supply licence. All applicants will be required to complete a prescribed application form and pay an application fee. 

Derogations for existing suppliers

Recognising that licensed electricity suppliers already face substantial regulatory obligations, Ofgem will apply targeted derogations where supply licence protections overlap with load control requirements, particularly for FSP activity relating to consumer protection and financial management. 

Derogations will be issued on a class basis before March 2028, so individual suppliers will not need to apply separately. Importantly, these are discretionary: Ofgem retains the power to require full compliance if concerns arise.

Compliance and enforcement

Enforcement will follow Ofgem's existing Enforcement Guidelines, with three initial priorities: 

1. Cyber security;
2. Treating customers fairly (particularly for non-supply licensees); and 
3. Operational, financial, and managerial controls. 

With state-sponsored attacks on UK energy infrastructure making headlines, prospective licensees, particularly new market entrants without established energy-sector cyber frameworks, should expect cyber readiness to face early and focused regulatory scrutiny.

Ofgem’s monitoring will be risk-based, targeted and proportionate, with requests for information intended to be used as the primary data-gathering tool.

What should businesses do now?

DESNZ intends to introduce secondary legislation into Parliament in Autumn 2026 to determine the load control standard licence conditions and give Ofgem powers to grant licences.

Subject to Parliamentary approval, the application window will potentially open as early as March 2027, which means companies remotely controlling domestic electricity demand should be assessing now whether their activities fall within scope of the new regime. Early engagement with Ofgem’s forthcoming licence application guidance (expected later this year) will be essential for a smooth transition.