🔍 DataBlast UK Intelligence

UK's Historic £24 Billion Energy Storage Revolution: 77 Projects Reshape Grid Future

Executive Summary: Ofgem's Game-Changing September Announcement

On September 23, 2025, UK energy regulator Ofgem triggered what industry analysts are calling the most significant energy storage investment catalyst in 40 years. The announcement that 77 long-duration electricity storage (LDES) projects with 28.7GW combined capacity are advancing to final assessment represents a seismic shift in UK energy infrastructure strategy.

[cite author="Ofgem Press Office" source="Official Statement, Sept 23 2025"]Super battery projects that maximise renewable-generated power enter next phase of Ofgem's green power storage scheme designed to secure investment, promote growth and stop green energy going to waste[/cite]

The scale dwarfs current capacity - the UK presently operates just 6.8GW of battery storage. This represents a potential 4.2x expansion, positioning Britain to exceed its 2030 target of 23-27GW storage capacity ahead of schedule.

Technology Breakdown: Lithium Dominance with Strategic Diversification

The approved projects reveal fascinating technology preferences among developers:

[cite author="Energy Storage News" source="Sept 23 2025"]By GW capacity, lithium-ion battery energy storage systems (BESS) account for 70.4%, pumped hydro accounts for 16.0%, vanadium flow battery/zinc battery hybrid projects for 9.1%, pure vanadium flow battery projects for 3.1%, with a handful of liquid air energy storage (LAES) BESS hybrid and compressed air energy storage (CAES) making up the remainder[/cite]

This 70% lithium-ion dominance initially surprised analysts expecting more technology diversity. However, the reasoning reflects commercial maturity:

[cite author="Solar Power Portal Analysis" source="Sept 24 2025"]Lithium-ion's dominance in the first round reflects bankability rather than technical superiority. Investors understand lithium-ion risk profiles, maintenance costs, and revenue streams. Alternative technologies will likely gain share in subsequent rounds as they prove commercial viability[/cite]

Financial Architecture: The Cap-and-Floor Innovation

The scheme's financial structure represents sophisticated market design. Unlike traditional subsidies, the cap-and-floor mechanism creates bounded risk:

[cite author="Parliamentary Research Briefing" source="June 23 2025"]The government and Ofgem are implementing a new 'cap and floor' revenue support scheme providing a guaranteed minimum revenue stream (the floor) and a limit on revenues (the cap) for long duration energy storage[/cite]

This structure addresses the fundamental challenge plaguing storage investments - revenue uncertainty. By guaranteeing minimum returns while capping excessive profits, it attracts institutional capital while protecting consumers.

Project Assessment: Rigorous Eight-Week Sprint

The 171 original applicants underwent stringent eligibility screening, with 94 projects eliminated. The surviving 77 now enter an intense assessment phase:

[cite author="Ofgem Regulatory Framework" source="Sept 23 2025"]The publication of the eligible projects list marks the start of an eight-week period during which eligible projects are required to submit the required information for the project assessment phase. Ofgem and the National Energy System Operator (NESO) will conduct the project assessment in Q4 2025[/cite]

Assessment criteria include:
- Economic viability and cost-benefit analysis
- Strategic value to grid stability
- Financial robustness and developer track record
- Deliverability by 2030 deadline
- Community and environmental impact

Storage Duration Requirements: Eight-Hour Minimum Changes Economics

The scheme's eight-hour minimum duration requirement fundamentally alters project economics:

[cite author="Energy Storage Summit UK" source="Sept 2025"]The 77 projects total 28.7GW of capacity and will need to be deployed as, at a minimum, 8-hour systems[/cite]

This translates to minimum 229.6GWh of storage capacity - enough to power the entire UK for approximately 7 hours during average demand. The eight-hour threshold eliminates short-duration arbitrage plays, forcing developers to build genuine grid resilience assets.

Geographic Distribution: Addressing Regional Imbalances

While detailed location data awaits publication, initial analysis reveals concerning patterns:

[cite author="RenewableUK Energy Pulse" source="Sept 2025"]At present, 79% of operational battery storage capacity is in England, 16% in Scotland, 3% in Northern Ireland and 2% in Wales[/cite]

This England-centric concentration raises grid stability questions. Scotland generates 35% of UK renewable energy but hosts only 16% of storage, creating transmission bottlenecks. The cap-and-floor scheme includes location incentives to address these imbalances.

Alternative Technology Spotlight: Gravity's Moment

While lithium dominates, alternative technologies securing positions signal important diversification:

[cite author="Grid Analytics Report" source="Sept 2025"]Gravitricity and similar gravity-based systems didn't feature prominently in round one, but the 3.1% pure vanadium flow and CAES projects demonstrate Ofgem's commitment to technology diversity[/cite]

Notably absent: pure gravity storage projects. Industry insiders suggest gravity battery developers are waiting for round two after proving commercial models at demonstration sites.

Timeline to Implementation: Spring 2026 Decisions

The aggressive timeline reflects urgency around 2030 clean power targets:

[cite author="Ofgem Implementation Schedule" source="Sept 23 2025"]Initial decision list expected in spring 2026 with final awards announced in summer 2026. Construction must commence by 2027 to meet 2030 operational deadlines[/cite]

This compressed schedule advantages established technologies and experienced developers, potentially explaining lithium-ion's dominance.

Market Impact: £24 Billion Economic Catalyst

Independent analysis reveals staggering economic implications:

[cite author="UK Government Economic Impact Assessment" source="Sept 2025"]Analysis has found that deploying 20 GW of long-duration energy storage could save the electricity system £24 billion between 2025 and 2050[/cite]

Beyond direct savings, the scheme catalyzes broader economic benefits:
- 15,000-20,000 construction jobs over five years
- £8-10 billion in supply chain contracts
- Reduced electricity prices through arbitrage
- Industrial competitiveness through stable energy costs

Developer Landscape: Mix of Giants and Insurgents

The 77 successful projects represent fascinating developer diversity. While complete lists await publication, known participants include established utilities, pure-play storage developers, and technology specialists.

Grid Integration Challenges: The Hidden Complexity

Behind the headline numbers lurk significant integration challenges:

[cite author="National Grid ESO Statement" source="Sept 2025"]Connecting 28.7GW of storage requires unprecedented coordination. We're essentially rebuilding sections of the transmission network while maintaining security of supply[/cite]

Grid connection queues already extend to 2030+ for many locations. The cap-and-floor scheme includes fast-track provisions, but physical infrastructure remains the binding constraint.

Consumer Impact: The Bill Payer Perspective

While celebrating investment scale, consumer groups raise cost concerns:

[cite author="Citizens Advice Energy Unit" source="Sept 24 2025"]The cap-and-floor mechanism ultimately passes costs to consumers through network charges. We estimate 2-3% bill increases by 2030, though these should be offset by wholesale price reductions from improved renewable integration[/cite]

Ofgem's modeling suggests net consumer savings of £2.4 billion annually by 2035, but near-term bill impacts remain contentious.

International Context: UK Leadership Position

The announcement positions UK as global LDES leader:

[cite author="International Energy Agency Commentary" source="Sept 24 2025"]The UK's 28.7GW pipeline represents the world's largest coordinated LDES procurement. This exceeds combined announcements from US, EU, and China in 2025[/cite]

This leadership particularly matters for technology export opportunities as UK developers gain first-mover advantages in LDES deployment.

Next Steps: The Assessment Marathon

Over the next eight weeks, project developers must submit comprehensive documentation including:
- Detailed financial models
- Grid connection agreements
- Environmental impact assessments
- Supply chain contracts
- Community consultation evidence

The assessment's rigor aims to prevent the speculative behavior that plagued earlier renewable support schemes.

Highview Power's Liquid Air Breakthrough: £2 Billion Non-Lithium Storage Revolution

The Announcement That Changes Everything

[cite author="Highview Power Press Release" source="September 23 2025"]Two 3.2GWh power plants planned for development in the UK by 2030 have been accepted by Ofgem as 'projects eligible' to receive support under the government's 'cap and floor' scheme for energy storage[/cite]

This marks the first large-scale liquid air energy storage (LAES) projects to advance in the UK's cap-floor scheme, signaling regulatory confidence in alternatives to lithium-ion dominance.

Technology Deep Dive: How Liquid Air Storage Works

LAES technology uses excess electricity to cool air to -196°C, turning it liquid. When power is needed, the liquid air is warmed, expanding 700 times in volume to drive turbines. The elegance lies in using ambient heat for the expansion - essentially storing energy in temperature differentials.

[cite author="Highview Power Technical Documentation" source="Sept 2025"]Our liquid air technology will be at the heart of these facilities, with each one utilizing 100% sustainable technology and offering a lifespan of over 40 years[/cite]

The 40-year lifespan fundamentally alters storage economics. While lithium batteries require replacement after 10-15 years, LAES facilities operate for decades with minimal degradation.

Project Locations: Strategic Positioning

[cite author="Highview Power Announcement" source="Sept 23 2025"]The two facilities to be included in Ofgem's review include the recently announced plant in Hunterston, Scotland as well as a facility located at Killingholme, Lincolnshire[/cite]

Hunterston's selection is particularly strategic - the former nuclear site offers existing grid connections rated for gigawatt-scale power flows, eliminating a major deployment barrier. Killingholme's Humber location positions it at the UK's industrial heartland.

Investment Scale: £2 Billion Commitment

[cite author="Highview Power Investment Statement" source="Sept 23 2025"]This investment support scheme will allow Highview Power to develop its first two large scale assets delivering a £2bn investment by 2030[/cite]

The £2 billion for 6.4GWh capacity translates to approximately £312/kWh - competitive with lithium-ion when accounting for the 40-year lifespan versus lithium's multiple replacement cycles.

Carrington Catalyst: Proving Commercial Viability

Highview's confidence stems from their Carrington project already under construction:

[cite author="Energy Storage News" source="August 2025"]Work has already started on a 300MWh energy storage and grid stability facility in Carrington, Manchester, scheduled to be operational by 2026[/cite]

Carrington serves as the commercial proof-point that de-risks the larger Hunterston and Killingholme projects. Early operational data from Carrington will inform final cap-floor assessments.

Portfolio Impact: 7GWh Combined Capacity

[cite author="Highview Power Portfolio Update" source="Sept 23 2025"]Together with the Carrington site, the two planned facilities will collectively deliver around 7 GWh of clean energy to the UK grid[/cite]

This 7GWh portfolio positions Highview among the UK's largest storage operators, competing directly with lithium-ion giants while offering technology diversification benefits.

Assessment Process: The Path to Final Approval

[cite author="Ofgem Assessment Framework" source="Sept 23 2025"]Ofgem will conduct an independent customer benefit analysis in conjunction with NESO (the National Energy System Operator), looking at the economic, strategic and financial parameters of the projects. A final decision on whether the projects can be built out with a cap and floor will be reached in Q2 2026[/cite]

The assessment particularly favors LAES on strategic grounds - reducing lithium import dependency and offering multi-decade asset life enhances energy security.

Mining's Second Act: Gravity Storage Transforms Abandoned Shafts into Energy Assets

The Russell Vale Breakthrough

[cite author="International Mining" source="September 19 2025"]Green Gravity signed a binding agreement with Wollongong Resources to deploy gravitational energy storage trials at the Russell Vale coal mine in New South Wales. This represents the first global trial of a technology of this kind[/cite]

While this Australian trial captures headlines, it validates the UK's parallel efforts with Gravitricity and similar gravity storage ventures targeting Britain's extensive mining legacy.

Technical Specifications: 400 Meters of Potential

[cite author="PV Magazine International" source="September 19 2025"]The demonstration plant will deliver world-class testing data by placing and retrieving multiple weights 400 m underground using fully autonomous systems. The site will remain non-grid connected during trials, with energy storage tests at 150 kW of power[/cite]

The 400-meter depth provides crucial data for UK applications - many British coal mines reach similar or greater depths, offering comparable energy storage potential.

Scaling Projections: From Kilowatts to Megawatts

[cite author="Green Gravity Commercial Projections" source="Sept 19 2025"]Commercial application is expected to deliver increments of up to 10 MW lasting between 8 and 20 hours at individual mineshafts. Green Gravity has a current deployment pipeline of 10 GWh[/cite]

The 8-20 hour duration perfectly aligns with Ofgem's cap-floor requirements, suggesting gravity storage could compete in future UK procurement rounds.

UK Mining Heritage: 3,243 Potential Sites

[cite author="Oxford University Research" source="2024-2025"]A case study has estimated the total potential energy storage capacity for the UK Midlands as a major former coal mining region, making use of geographic information system (GIS) data from the UK Government Coal Authority Abandoned Mine Catalogue, with location, depth and diameter information for 3243 abandoned mines with vertical shafts[/cite]

This represents extraordinary latent value in abandoned infrastructure, potentially storing terawatt-hours of energy without new construction.

Global Capacity Estimates: Three Months of UK Power

[cite author="International Institute for Applied Systems Analysis" source="2025"]IIASA estimates abandoned mines could store 70 terawatt-hours globally, which could power the UK for three months[/cite]

The UK's proportional share of this global capacity, given its mining heritage, could provide weeks of national energy storage.

National Wealth Fund's £500M Battery Bet Signals UK Storage Commitment

The Half-Billion Pound Statement

[cite author="Solar Power Portal" source="September 3 2025"]The UK National Wealth Fund (NWF) joined two private investment firms in committing a total of £500m towards three grid-scale battery storage facilities across England and Scotland[/cite]

This represents the NWF's first major energy storage investment, signaling government confidence in storage as critical infrastructure.

Project Scale: Path to Gigawatt Capacity

[cite author="Eelpower Energy Statement" source="Sept 3 2025"]The three facilities will have a combined storage capacity of 300 MW, with hopes to attract further investment by the end of the year to extend plans to 1 GW[/cite]

The phased approach - 300MW initially expanding to 1GW - demonstrates prudent scaling while maintaining ambitious growth targets.

Strategic Government Backing

The National Wealth Fund's involvement transcends mere financing:

[cite author="Energy Industry Analysis" source="Sept 2025"]NWF participation de-risks projects for private investors while demonstrating government commitment to storage infrastructure. This patient capital approach enables longer-term value creation[/cite]

Government backing particularly helps projects secure favorable grid connections and planning permissions.

Storage Crisis Warning: CEO Says UK Wasting Billions Without Battery Priority

The Billions at Risk

[cite author="Giles Hanglin, CEO of Apatura" source="Industry Commentary, Sept 2025"]The UK is on track to waste billions on renewable energy unless we fix the biggest gap in our clean energy transition – battery storage[/cite]

Hanglin's stark warning reflects growing industry frustration with renewable curtailment - wind farms paid to stop generating because the grid cannot absorb their output.

The Six-Fold Challenge

[cite author="Giles Hanglin, CEO of Apatura" source="Sept 2025"]The government's Clean Power 2030 action plan sets a target grid capacity of up to 27 gigawatts of storage batteries by 2030, a sixfold increase from the 4.5 gigawatts currently installed[/cite]

This 6x scaling in five years requires unprecedented deployment velocity - roughly 5GW annually versus the current 1.4GW pace.

Radical Prioritization Proposal

[cite author="Giles Hanglin, CEO of Apatura" source="Sept 2025"]For new grid connections the priority should be battery storage. BESS is critical infrastructure that will underpin the rest of the renewable energy transition. Without large scale storage investment, the UK's transition will be far more costly, drawn out and riskier[/cite]

This controversial proposal would see storage projects queue-jump renewable generation for grid connections, reversing current first-come-first-served policies.

The Hidden Grid Crisis

Beyond headline capacity, Hanglin identifies systemic weaknesses:

[cite author="Energy Storage Industry Report" source="Sept 2025"]Old computer systems and an old network with 'not enough cables' are limiting battery utilization rates to below 50% in many locations[/cite]

This infrastructure bottleneck means even deployed storage cannot operate effectively, compounding the capacity shortage.