In a landmark move that promises to revolutionise Britain’s energy landscape, Ofgem has launched a groundbreaking cap and floor investment scheme for Long Duration Electricity Storage (LDES).
This initiative, the first major development in energy storage in four decades, marks a significant step towards achieving the UK’s ambitious clean energy goals and addressing the longstanding challenge of renewable energy intermittency.
Bridging the power storage gap in renewable energy
While renewable energy sources like wind and solar have seen tremendous growth in recent years, their intermittent nature has posed a significant challenge to grid stability and energy security.
On windy or sunny days, these sources can generate more power than the grid can handle, leading to wasted energy.
Conversely, during periods of low wind or sunlight, additional sources are needed to meet demand.
For 40 years, Britain has not built any new LDES infrastructure, leaving a critical gap in our ability to store and utilise clean energy effectively.
Akshay Kaul, Director General for Infrastructure at Ofgem, emphasises the importance of addressing this issue:
“Renewable energy is the key to securing Britain’s energy independence and driving down customer bills in the long term – so it’s vital that none of this precious resource goes to waste”.
The cap and floor power storage scheme
Ofgem’s new cap and floor scheme is designed to overcome the barriers that have hindered LDES development.
The scheme provides a minimum revenue guarantee for LDES operators, helping to manage the high upfront costs and long build times associated with these projects.
At the same time, it protects consumers by capping profits, ensuring that any excess revenues flow back to customers via their bills.
To qualify for the scheme, projects must have a storage capacity of more than eight hours and meet specific efficiency criteria.
This approach aims to drive down costs while ensuring that only the most effective projects receive support.
Powering the power storage future
While Pumped Storage Hydropower (PSH) has been the backbone of Britain’s energy storage capacity for decades, the new scheme opens doors for emerging technologies such as liquid air energy storage, compressed air energy storage, and flow batteries.
These innovations promise to diversify our storage capabilities and enhance grid flexibility.
Currently, Britain has 2.8 gigawatts of LDES capacity across four PSH facilities in Scotland and Wales.
The National Energy Systems Operator (NESO) has advised adding an indicative range of 2.7 to 7.7 gigawatts of stored power by 2035, effectively doubling or even tripling our current strategic reserve.
A win for consumers and the economy
The potential economic impact of this initiative is substantial.
Government analysis suggests that deploying 20GW of LDES, the current target set for 2050, could save the electricity system £24 billion between 2030 and 20501.
These savings are expected to translate into reduced household energy bills as cheaper renewable energy becomes more readily available during peak demand periods, reducing reliance on expensive natural gas.
Moreover, this investment in LDES is poised to enhance Britain’s energy independence, creating a more resilient and secure power system less vulnerable to global energy market fluctuations.
Implementation timeline to clean energy
Ofgem has set an ambitious timeline for implementing the LDES scheme.
The first application window is set to open in Q2 2026, with two distinct tracks: a 2030 delivery track and a 2033 delivery track. This approach allows for both near-term solutions and longer-term technological developments.
The regulator expects to agree on the first batch of projects under the cap and floor scheme by Q2 2026, setting the stage for rapid expansion of Britain’s energy storage capacity over the coming decade.
Impact on talent and recruitment
The LDES initiative is not just about infrastructure; it’s about people.
As the sector expands, it will create thousands of new jobs across various disciplines, from engineering and project management to environmental science and regulatory compliance.
Key skills in demand for LDES projects will include:
Electrical and mechanical engineering
Energy systems design and optimisation
Project management and construction oversight
Environmental impact assessment
Regulatory compliance and policy analysis
Data analytics and energy forecasting
Regional recruitment hotspots are likely to emerge around existing and planned LDES sites, particularly in Scotland and Wales where many PSH facilities are located.
However, the diversification of storage technologies means that opportunities will spread across the UK.
The transition to clean energy also presents opportunities for workers from traditional energy sectors to transfer their skills.
Many roles in LDES projects require expertise that overlaps with conventional power generation, creating a pathway for career transitions.
However, the rapid growth of the sector is likely to expose skills gaps, particularly in emerging technologies.
This will necessitate targeted training programs and partnerships between industry, education providers, and government to ensure a skilled workforce is ready to meet the demand.
How Astute can help with recruitment
As the LDES sector expands, companies will face increasing competition for top talent.
This is where Astute’s expertise becomes invaluable.
With an extensive database of over 100,000 candidates and a track record of filling more than 10,000 vacancies, Astute is well-positioned to meet the recruitment challenges of this growing sector.
Astute’s specialisation in Power, Renewables, and Nuclear sectors makes us uniquely qualified to understand and meet the specific talent needs of LDES projects.
Our range of tailored recruitment solutions caters to various hiring needs:
People Lite: For occasional staffing needs
People Plus: Enhanced recruitment for building teams
People Solutions: Fully outsourced solution for regular hires
People Search: Executive search for strategic, senior positions
Our industry expertise and consultative approach ensure that we not only find candidates with the right skills but also those who align with your company culture and project goals.
With our global coverage and presence in both the UK and US, we can tap into international talent pools to find the best candidates for your LDES projects.
A new era for Britain’s energy landscape
After four decades of stagnation in energy storage development, Ofgem’s cap and floor scheme for LDES marks the dawn of a new era.
This initiative has the potential to transform Britain’s energy landscape, enhancing our ability to harness renewable energy, reduce costs for consumers, and bolster energy security.
As we move forward, the success of this initiative will depend not only on technological innovation and infrastructure development but also on the skilled workforce that will bring these projects to life.
With the right support, training, and recruitment strategies, Britain can lead the way in clean energy storage, creating a more sustainable and prosperous future for generations to come.
