IHA Urges the need for Cap & Floor for LDES
Malcolm Turnbull urges UK to adopt cap-and-floor for energy storage, citing nearly 7GW in ready projects to aid decarbonisation and energy.
Former Australian Prime Minister and current president of the International Hydropower Association (IHA), Malcolm Turnbull, has issued an open letter to Rishi Sunak, urging for the swift implementation of the cap and floor mechanism for long-duration energy storage (LDES). In the letter, Turnbull highlights that the UK possesses nearly 7GW of shovel-ready pumped storage hydropower projects, boasting over 135GWh of storage capacity. These projects stand poised to significantly contribute to the UK's decarbonisation efforts while bolstering energy security.
Should these projects come to fruition, the UK's energy storage capacity would undergo a five-fold increase. Turnbull applauds the recent LDES government consultation, recognising it as a step forward in establishing a policy framework conducive to the rapid deployment of LDES technologies like pumped storage hydropower (PSH).
Turnbull underscores the critical role of technologies like PSH in the UK's transition to net zero emissions. With the rapid proliferation of variable renewable energy sources such as solar and wind, energy storage technologies become imperative to ensure supply security, particularly during periods of low generation.
Traditionally, gas peaker plants have served as a fallback to ensure supply security, but their carbon footprint undermines net zero goals. Turnbull argues that PSH and battery technologies offer viable alternatives to replace these carbon-intensive plants.
Drawing from his experience, Turnbull cites a case study from South Australia, where a state-wide electricity blackout occurred in 2016 due to insufficient firming of renewable energy sources, predominantly wind. This incident prompted the Australian government to prioritise storage and pumped hydro, leading to the development of projects like Snowy Hydro 2.0.
Turnbull emphasises that pumped storage has since played a pivotal role in Australia's energy transition, with projects like those in Queensland rivaling the scale of Snowy 2.0.
In his letter, Turnbull offers recommendations to the UK government to support LDES technologies. He advocates for expeditious delivery of the LDES scheme, aiming for the first application window to open by early 2025, focusing on mature projects to bolster investor confidence.
Additionally, Turnbull suggests guaranteeing future application windows, setting soft targets for LDES, and ensuring long-term contract visibility. Coupled with comprehensive reforms of the electricity market, including the Capacity Market, these measures would enhance remuneration for grid services and foster investor certainty.
