Santander funds Econergy Immingham battery project as UK storage sector sees mixed developments

Econergy has secured £42.7 million in project financing from Santander to advance its 80MW/240MWh battery energy storage system (BESS) development in Immingham. The funding, arranged through Ecostar 1 Immingham Ltd, is designated to cover construction expenses and repay shareholder loans incurred during the development phase. Concurrently, the company has entered into two separate revenue floor agreements with EDF Energy customers, each covering 40MW of the facility’s capacity. These arrangements provide a guaranteed annual revenue floor alongside a sharing mechanism, with Econergy projecting that contracted revenues from these deals and associated capacity market participation will generate between £45 million and £50 million over their term.

Joshua Murphy, Econergy’s director of energy storage, described the transaction as a significant milestone for UK storage infrastructure. He noted that upon commissioning, the three-hour battery would rank among the largest in the country with an operating duration exceeding two hours. The financing structure underscores growing institutional confidence in long-duration storage assets capable of providing grid stability and balancing services.

In parallel developments within the private equity sector, Nature Infrastructure Capital (NIC) has invested in Anesco, a developer with a 7GW pipeline of solar and battery projects across the United Kingdom. NIC intends to provide capital for both investment and construction phases, supporting the expansion of a portfolio that has already delivered 1.3GW of solar capacity. Anesco recently acquired a 36MWp solar farm project in partnership with One Planet Developments, Viridi Re Development, Solar Ambition Europe, and landowner Kingwell. Once operational, the Beachampton site is expected to supply clean electricity to approximately 9,000 homes. Additionally, Anesco obtained planning consent from South Staffordshire Council for a 48MW solar farm in Coven, which will cover 143 acres and power around 13,000 residences.

Community opposition continues to influence project outcomes, as evidenced by the rejection of plans for a BESS site in South Hetton, Durham. Local councillors dismissed proposals for 98 battery containers following 700 objections raised during public consultation. Residents cited safety concerns, with some comparing the installation to a chemical refinery. Although Durham County Council’s planning committee had advocated for development and local fire services raised no objections, the proposal was withdrawn. The developer, Rewe 8, had argued that battery storage plays a crucial role in decarbonising the national grid, while noting that emergency water tanks were planned as a safety precaution.

In Scotland, construction has commenced on the 200MW/400MWh Windyhill BESS project near Glasgow. EPC contractor Mitie and developer Revera broke ground on the two-hour facility, which is scheduled to come online in 2028. A second phase with equal capacity will follow. Revera reached a final investment decision in March after securing a ten-year revenue floor agreement with Danske Commodities. This project forms part of a broader portfolio including Hunterston and Kincardine, representing approximately £500 million in total investment.

Internationally, Centrica Energy and Zelestra have signed a physical tolling agreement for 99MW/297MWh of storage capacity at Zelestra’s Hilgermissen project in Germany. Zelestra will develop and own the asset, with engineering completion expected this year, construction starting in 2027, and operations beginning in 2028. Centrica Energy will optimise the battery’s performance through its trading services across Day-Ahead, Intraday, and Ancillary Services markets. Cassim Mangerah, managing director at Centrica Energy, highlighted the agreement as a key step in expanding their German flexibility portfolio.

Meanwhile, Greenvolt Power has inaugurated its 200MW/800MWh Turośń Kościelna BESS facility in Poland. The site, which uses lithium iron phosphate technology comprising 196 containerised modules and 49 transformer stations, will participate in the capacity market from 2028 under a 17-year contract with a 170MW obligation. Greenvolt is also advancing its Ełk project, due for operation in late 2026, and developing a 600MW/2.4GWh facility in Siedlce. João Manso Neto, chief executive of Greenvolt Group, emphasised the growing necessity of flexibility as power systems become increasingly electrified.

Finally, Coalburn 1, a 500MW two-hour lithium-ion BESS in South Lanarkshire, has become operational. Developed by CIP, it is one of three transmission-connected assets in Scotland that will collectively provide 1.5GW of power capacity and 3GWh of storage. Nischal Agarwal, a CIP partner, stated that the facility enhances grid resilience and supports renewable integration as Europe’s largest operational battery storage system.