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.
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 will publish a joint technical document with DESNZ in the first quarter of 2025. This document will set out the details of the LDES cap and floor regime and the allocation and eligibility criteria for approving projects. Following the technical document, Ofgem will open an application window in the second quarter of 2025 to approve new Long Duration Electricity Storage projects for the cap and floor regime. We are also developing a cap and floor licensing framework.
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.
To learn more, listen to our webinar about Long Duration Electricity Storage. If you’re interested in the FAQ document from this webinar, please email LDES@ofgem.gov.uk.
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.