Insights

How many hours will a lender back?

Published energy-storageldesfinancing
Three long rows of pale modular units lit at ground level on a concrete pad in a Scottish glen at dusk, with a large industrial hall, pylons and a misty loch beyond

Last week, eight battery developers told Ofgem that 7.6 GW of long-duration storage was too much for the first cap-and-floor window [1]. The analysis they commissioned puts the potential cost to billpayers at about £1.6bn [2]. I’ve been turning that over, because the split between the two sides is easy to misread.

Eleven of the 16 projects on Ofgem’s minded-to list are lithium-ion [3][4]. Field alone has five, totalling roughly 1.6 GW and 27 GWh, each designed to run for 16 to 18 hours [5]. The coalition, which includes Zenobē, Fidra and Conrad, operates around 2 GW of short-duration batteries and has another 5.6 GW in development [2]. The dispute is over which projects get a revenue floor and what that does to the economics of the batteries that depend on merchant revenues.

In Australia, Quinbrook and CATL billed EnerQB last year as the first genuine eight-hour battery, with 3 GW and 24 GWh planned [6]. There are reports this week of first shipments [7]. Yet when the next stage of Quinbrook’s Supernode campus secured financing this summer, CATL confirmed it would use Tener S and said only that EnerQB was being considered for future stages; ESS News describes it as in pilot testing. On Quinbrook’s published figures, Supernode works out at roughly four hours [8].

Ofgem’s list shows developers are prepared to design lithium-ion projects for 16 hours or more when there’s a prospect of a revenue floor. The Australian example shows what actually secured financing at Supernode. There’s only so far I’d take that comparison. Australian price spreads can favour a different duration, and EnerQB may simply need more time in testing for technical or warranty reasons. Even so, it makes me wonder how much of the duration a lender will back comes down to the revenue contract.

The final Window 1 decision turns in part on how much of that capacity the market would finance anyway, and at what cost to billpayers. An award still leaves work to do. SSE has said Coire Glas would have to meet its return thresholds before it takes an investment decision [9], and Modo Energy counts only nine of the 16 projects as having full planning consent [10].

Ore Energy is courting data centres for its 100-hour iron-air battery, though its headline deal so far is with a Dutch energy supplier [11]. If you’ve sat across a term sheet for long-duration storage, I’d value your view. What would a tolling agreement or a data-centre offtake have to cover for you to lend against a 16-hour battery without a floor?

Sources

  1. Utility Week, “Ofgem urged to pump the brakes on long-duration energy storage”. https://utilityweek.co.uk/ofgem-urged-to-pump-the-brakes-on-long-duration-energy-storage/
  2. ESS News, “BESS developers warn LDES cap and floor could cost billpayers GBP 1.6 billion”, 30 October 2026. https://www.ess-news.com/2026/10/30/uk-bess-developers-warn-ldes-cap-and-floor-could-cost-billpayers-gbp-1-6-billion/
  3. Ofgem, “Long duration electricity storage window 1: minded-to decisions”, 26 June 2026. https://www.ofgem.gov.uk/consultation/long-duration-electricity-storage-window-1-minded-decisions
  4. Foot Anstey, “LDES Cap & Floor: Ofgem reveals the 16 projects set to shape the UK’s storage future”, 3 July 2026. https://www.footanstey.com/our-insights/articles-news/ldes-cap-floor-ofgem-reveals-the-16-projects-set-to-shape-the-uks-storage-future/
  5. Energy-Storage.News, “UK’s Ofgem goes big on LDES cap-and-floor window 1; 18-hour lithium-ion among winners”. https://www.energy-storage.news/uks-ofgem-goes-big-on-ldes-cap-and-floor-window-1-18-hour-lithium-ion-among-winners/
  6. Energy-Storage.News, “Quinbrook, CATL unveil 8-hour duration BESS technology set for Australia”, March 2025. https://www.energy-storage.news/quinbrook-catl-unveil-8-hour-duration-bess-technology-set-for-australia
  7. 21st Century Business Herald (21jingji), “宁德时代EnerQB设备下线交付 长时储能将迈向规模化应用”, 3 November 2026. https://21jingji.com/article/20261103/herald/8419b35d035ec0043ebdabc1828dfd55.html
  8. ESS News, “CATL confirms Tener S for Quinbrook’s massive Supernode Stage 3 in Australia”, 17 August 2026. https://www.ess-news.com/2026/08/17/quinbrook-commits-to-third-stage-of-massive-supernode-project-with-catl/
  9. SSE Renewables, “SSE statement on Ofgem LDES ‘Minded-to-Decision’ list”, 26 June 2026. https://www.sserenewables.com/news-and-views/2026/06/sse-statement-on-ofgem-ldes-minded-to-decision-list/
  10. Modo Energy, “LDES Window 1 Minded-to Cap and Floor scheme: which projects are likely to deliver?”, 2 September 2026. https://modoenergy.com/research/en/gb-ldes-window-1-project-attrition-delivery
  11. Energy-Storage.News, “European multi-day energy storage startup Ore Energy raises US$43 million in Series A”, 2026. https://www.energy-storage.news/european-multi-day-energy-storage-startup-ore-energy-raises-us43-million-in-series-a/
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