Question

To ask the Secretary of State for Energy and Climate Change, what support his Department provides to encourage the production of electricity storage capacity in the UK.

The Low Carbon Innovation Coordination Group's (LCICG) Strategic Framework, published February 2014, notes that innovation in storage is important to realising the enabling benefits of electricity storage technologies. In the Strategic Framework, the LCICG concludes that successful innovation in electricity storage technologies could save the UK energy system about £4.6billion by 2050.

DECC is providing significant innovation support for energy storage technologiesby funding 7 research and 4 large-scale demonstration energy storage projects – with a total budget of about £18m.

DECC also regards storage – along with demand side response (DSR) - as essential for a better functioning electricity market and both play an important role in ensuring security of supply. The Government is implementing measures to establish broader and more flexible DSR and Storage sectors as part of the Electricity Market Reform programme. Specifically, DECC will run two Capacity Market transitional auctions in 2015 and 2016, ahead of the Capacity Market's first full delivery year in 2018/19. These “transitional arrangements” will help grow the demand side and sub-50MW storage industries and ensure effective competition between traditional power plants and new forms of capacity, driving down future costs for consumers. The Irish Single Electricity Market already uses a capacity mechanism so the UK Government and Northern Ireland have agreed that the Capacity Market will only apply across Great Britain with any associated costs being borne by GB customers only.