UK launches investment support scheme for long-duration energy storage

The UK government has introduced a new investment support scheme to bolster the country’s energy storage infrastructure, with a focus on long-duration energy storage (LDES) technologies. These projects, including pumped storage hydro, are essential for storing renewable energy and ensuring its availability when needed, acting as giant batteries for the grid.

LDES technologies have faced investment challenges due to high upfront costs despite low operational expenses. The new scheme is designed to overcome these barriers, aiming to unlock billions in funding and create thousands of jobs, contributing to the UK’s net-zero goals.

The initiative precedes the UK’s International Investment Summit and follows a consultation proposing a “cap and floor” model, which guarantees a minimum income for developers while capping revenues. Ofgem, the UK’s energy regulator, will oversee the scheme, with the first round of applications expected to open in 2025.

Great Britain currently has 2.8 GW of LDES capacity, primarily from pumped storage hydro schemes in Scotland and Wales. The scheme will also support emerging technologies like liquid air energy storage, compressed air energy storage, and flow batteries. Studies suggest that deploying 20 GW of LDES could save the electricity system £24 billion between 2025 and 2050, reducing household energy bills by decreasing reliance on natural gas.

The National Electricity System Operator estimates that achieving net-zero by 2050 will require 11.5 GW to 15.3 GW of LDES. The new support scheme is expected to facilitate the delivery of several projects under development by 2030.