Britain is set to see a wave of massive ‘water batteries’ emerging in the near future, as part of a fresh initiative to stimulate investments in clean energy storage. Government officials have approved plans to reduce the risks associated with developing and investing in pumped storage hydropower, a method of energy storage that utilises reservoirs. These sites operate by purchasing electricity at lower costs, such as during periods when wind turbines are active, to pump water uphill from a river or lake, where it is stored at the top. Subsequently, during times of higher electricity prices or increased demand, the water is released downhill to generate more power for the grid.
Although the technology is not novel, with Britain already having four similar sites in Scotland and Wales, no new projects have been constructed in nearly four decades due to the high development costs, despite relatively low operating expenses. Several new sites are in the pipeline, including one at Loch Ness in the Scottish Highlands. Government estimates indicate that the UK requires about five times more long-duration energy storage capacity to achieve net-zero emissions by 2050.
In an effort to attract more investments, ministers aim to introduce a new mechanism known as the ‘cap-and-floor’ scheme. This system will guarantee a minimum income for companies involved in project development, while imposing a revenue cap on how much they can earn from these sites. Energy Minister Michael Shanks expressed that this plan will enhance the nation’s energy storage capabilities for moments when renewable sources are not actively generating power. By storing excess clean energy produced from renewable sources, these projects could bolster energy security, reduce reliance on fossil fuels, stabilise household bills, and advance the UK’s mission to become a leading clean energy producer.
The scheme’s design will be overseen by energy regulator Ofgem, with the initial round of applications set to open in 2025. The model aims to not only support investments in pumped storage hydropower but also in emerging energy storage technologies like liquid air energy storage, compressed air energy storage, and flow batteries. Additionally, Ofgem will solicit applications for the development of these innovative storage solutions as part of the initiative. A comparable scheme exists to facilitate investments in electricity interconnectors that link the UK grid to other countries, having been implemented in 2014.
Following a consultation held under the previous Conservative government and concluded in March, this initiative represents another significant step towards decarbonising the power system. With the potential to unlock investments in vital technologies, the UK’s move towards sustainable power generation is expected to gain momentum, paving the way for a cleaner and more resilient energy landscape.