Trade bodies Scottish Renewables and the British Hydropower Association or BHA have jointly written to government officials urging support for the industry.
More specifically, both parties want to see a cap and floor mechanism introduced to expedite investment for long-duration electricity storage or LDES.
The proposal includes pumped storage hydro or PSH. The trade bodies co-wrote the letter to Ed Miliband (Energy Secretary), Ian Murray (Secretary of State for Scotland) and Jo Stevens (Secretary of State for Wales). Notably, Murray recently recognised the value of the cap and floor mechanism.
The letter urges the introduction of the LDES cap and floor mechanism. A cap and floor mechanism involves a minimum guaranteed revenue for investors. The cap acts as a limit preventing uncontrolled returns.
Moreover, the hydropower industry wants the government to publish a response to this year’s LDES consultation come August. The industry has also urged the government to set up a policy framework by the end of the year and open an initial LDES tech application window by early 2025.