The role of large scale storage in a GB low carbon energy future: issues and policy challenges Philipp Gr¨ unewald 1 , Tim Cockerill 1 , Marcello Contestabile 1 , Peter Pearson 1 a Centre for Energy Policy and Technology, Imperial College London, 311 Mechanical Engineering Building, London SW7 2AZ, UK b Low Carbon Research Institute, Cardiff University, Welsh School of Architecture, Bute Building, King Edward VII Avenue, Cardiff, CF10 3NB Abstract Large scale storage offers the prospect of capturing and using excess elec- tricity within a low carbon energy system, which otherwise might have to be wasted. Incorporating the role of storage into current scenario tools is chal- lenging, because it requires high temporal resolution to reflect the effects of intermittent sources on system balancing. This study draws on results from a model with such resolution. It concludes that large scale storage could become economically viable for scenarios with high penetration of renew- ables. As the proportion of intermittent sources increases, the optimal type of storage shifts towards solutions with low energy related costs, even at the expense of efficiency. However, a range of uncertainties have been identified, concerning storage technology development, the regulatory environment, al- ternatives to storage and the stochastic uncertainty of year on year revenues. All of these negatively affect the cost of finance and the chances of successful market uptake. We argue, therefore, that, if the possible wider system and social benefits from the presence of storage are to be achieved, stronger and more strategic policy support may be necessary. More work on the social Preprint submitted to Energy Policy June 15, 2011