Can a heat pump join the Balancing Mechanism?
Is it fast enough? Would anyone notice? How often would it actually get called? And if it did all that — if it turned down obediently, on a cold evening, when the control room needed it — what would the household get paid?
These are answerable with measured data rather than assumptions. Five hundred and nineteen real British heat pumps publish their monitoring to heatpumpmonitor.org: electrical input, heat output, flow and return temperatures, indoor and outdoor temperature, every few minutes, for years. So: take a winter of it, fit the building physics house by house, and run each one against real half-hourly system prices.
The answers to the first three questions are yes, no, and constantly.