Long duration electricity storage

Long Duration Electricity Storage (LDES) technologies contribute to decarbonising and making our energy system more resilient by storing electricity and releasing it when needed. LDES can also help reduce costs for consumers through reducing their bills and by avoiding the need for expensive electricity grid upgrades.

Our role and responsibilities

Ofgem is the regulator for Long Duration Electricity Storage and oversees implementation of a 'cap and floor' regime for LDES projects, proposed by the Department for Energy Security and Net Zero (DESNZ). The aim of this regime is to stimulate investment in Long Duration Electricity Storage projects. 

Under the cap and floor model, when revenues fall below a set minimum (the floor), consumers top up the difference. If revenues go above a set maximum (the cap), the extra money goes back to consumers. This provides investors with revenue certainty and tackles the issues of high upfront costs and market uncertainty for LDES projects. 

What we're working on

Ofgem has published a joint technical document with DESNZ. This document sets out the details of the LDES cap and floor regime, including the eligibility criteria, assessment process and timelines for approving projects.  

Ofgem opened its first application window for new LDES projects under the cap and floor regime on 8th April 2025

Between now and Q2 2026, we will work with stakeholders to develop regime documents, including the licence (a modified form of the Electricity Generation Licence with Standard and Special Conditions), a cost-benefit analysis (CBA) framework, and assess projects for approval in Q2 2026.  

The timelines align with National Energy System Operator (NESO)’s Clean Power 2030 advice to the government, which sees an important role for LDES in achieving clean power by 2030.

We will be holding an initial Stakeholder workshop on 29th April 2025 to consult stakeholders on our initial views regarding the scope and scenarios of the CBA ahead of publication of a consultation. While we do not expect the workshop to reach consensus among all stakeholders, it will enhance transparency and allow stakeholders to provide early feedback on our initial thinking about the CBA framework. We encourage industry stakeholders who have a legitimate interest in LDES to sign up.

To learn more, listen to our webinar about Long Duration Electricity Storage.

Contact the LDES team

If you would like to speak to someone at Ofgem about our work on the Long Duration Electricity Storage cap and floor regime, please email LDES@ofgem.gov.uk.