First Minister calls on UK Government to provide support for power storage

First Minister Humza Yousaf has called on the UK Government to provide support for power storage as he visited the site of a potential new £500 million plant.

Energy firm Drax has been given permission to develop the new underground pumped storage hydro plant at Cruachan, Argyll and Bute – the site of a similar facility owned by the company – by the Scottish Government.

Bosses say the new centre would bring the site’s generation capacity to more than one gigawatt and support 1,000 jobs across the supply chain.

Both Drax and the Scottish Government have called on the UK to introduce a “cap and floor” regime for such power stations, ensuring a minimum level of guaranteed revenue and thus certainty for projects to go ahead.

The firm, however, has said it will not begin development at Cruachan until a regulatory framework is put in place to support it.

Drax Group CEO Will Gardiner said: “This is a major milestone in Drax’s plans to build Britain’s first new pumped storage hydro plant in a generation.

“These plants play a critical role in stabilising the electricity system, helping to balance supply and demand through storing excess power from the national grid.

“When Scotland’s wind turbines are generating more power than we need, Cruachan steps in to store the renewable electricity so it doesn’t go to waste.

“With the right support from the UK Government, Drax will invest c.£500 million to more than double Cruachan’s generating capacity and support almost 1,000 jobs across the supply chain during construction.”

Mr Yousaf said: “Hydro power has real potential to play a greater role in our transition to net zero and to help ensure a resilient and secure electricity supply across the UK.

“The expansion of Cruachan will help to strengthen our energy security by providing much-needed resilience in the system, supporting hundreds of jobs and providing a real boost to the Scottish economy.

“However, we know that there remain a number of challenges in developing new hydro power projects in Scotland.

“The Scottish Government will continue to urge the UK Government to provide an appropriate market mechanism for hydro power and other long duration energy storage technologies, to ensure that the potential for hydro power is fully realised.”

The First Minister in May wrote to Rishi Sunak urging him to introduce a cap and floor mechanism for similar projects.