The British government has said it plans to fund long-duration energy storage projects in the UK, pledging £6.7 million ($9.11 million) in funding,media reported.
The UK Department for Business, Energy and Industrial Strategy (BEIS) provided competitive financing totalling £68 million in June 2021 through the National Net Zero Innovation Portfolio (NZIP). A total of 24 long-term energy storage demonstration projects were funded.
Funding for these long-duration energy storage projects will be split into two rounds: The first round of funding (Stream1) is for demonstration projects of long-duration energy storage technologies that are close to commercial operation, and aims to accelerate the development process so that they can be deployed in in the UK electricity system. The second round of funding (Stream2) aims to accelerate the commercialization of innovative energy storage projects through "first-of-its-kind" technologies for building complete power systems.
The five projects funded in the first round are green hydrogen electrolyzers, gravity energy storage, vanadium redox flow batteries (VRFB), compressed air energy storage (A-CAES), and an integrated solution for pressurized seawater and compressed air. plan.
Thermal energy storage technologies fit this criteria, but none of the projects received first-round funding. Each long-duration energy storage project that receives funding in the first round will receive funding ranging from £471,760 to £1 million.
However, there are six thermal energy storage technologies among the 19 projects that received funding in the second round. The UK Department for Business, Energy and Industrial Strategy (BEIS) said the 19 projects must submit feasibility studies for their proposed technologies and contribute to knowledge sharing and industry capacity building.
Projects receiving funding in the second round received funding ranging from £79,560 to £150,000 for the deployment of six thermal energy storage projects, four power-to-x category projects and nine battery storage projects.
The UK Department for Business, Energy and Industrial Strategy (BEIS) launched a three-month long-duration energy storage call in July last year to assess how best to deploy long-duration energy storage technologies at scale.
A recent report by energy industry consultancy Aurora Energy Research estimated that by 2035, the UK may need to deploy up to 24GW of energy storage with a duration of four hours or more to reach its net-zero target.
This will enable the integration of variable renewable energy generation and reduce electricity bills for UK households by £1.13bn by 2035. It could also reduce the UK's reliance on natural gas for electricity generation by 50TWh a year and cut carbon emissions by 100 million tonnes.
However, the report notes that high upfront costs, long lead times and a lack of business models and market signals have led to underinvestment in long-duration energy storage. The company's report recommends policy support from the UK and market reforms.
A separate KPMG report a few weeks ago said a “cap and floor” mechanism would be the best way to reduce investor risk while encouraging long-duration storage operators to respond to power system demands.
In the U.S., the U.S. Department of Energy is working on the Energy Storage Grand Challenge, a policy driver aimed at reducing costs and accelerating the adoption of energy storage systems, including similar competitive financing opportunities for long-duration energy storage technologies and projects. Its goal is to reduce long-term energy storage costs by 90 percent by 2030.
Meanwhile, some European trade associations have recently called on the European Union (EU) to take an equally aggressive stance to support the development and deployment of long-duration energy storage technologies, particularly in the European Green Deal package.