The Commission for Regulation of Utilities (CRU) has approved, subject to conditions, EirGrid’s framework for the procurement of up to 500MW of Long Duration Energy Storage (LDES), clearing the way for Ireland’s first dedicated LDES support scheme.

The decision (CRU2026174), published on 5 October 2026, follows EirGrid’s October 2025 consultation (which we reviewed here). It is informed by EirGrid’s recommendation paper to the CRU and a Levelised Cost of Storage methodology paper which are expected to be published shortly.

The decision settles the eligibility criteria, tender weightings, revenue floor and contract term for the initial procurement round. The CRU has confirmed that the decision does not constitute approval of any future procurement rounds. Furthermore, several of the mechanisms that will matter most to bidders and lenders are left to a second consultation on contractual arrangements. Here is our summary of the key elements of this initial decision and what they mean for investors, developers and their advisers.

Key Changes Since the Consultation

• Volume: the procurement for this phase has increased from the 201–300MW range originally indicated to a maximum of 500MW. The CRU stresses that this is a ceiling, not a target. Before contracts are awarded, EirGrid must notify the CRU of the proposed portfolio, aggregate volume and expected cost to consumers.
• Weightings: tenders will be scored on Cost (50%), Impact (30%) and Connection Method (20%). Impact will be assessed using the Enduring Connection Policy 2.5 hourly dispatch-down modelling and will reward those projects located in areas that can best address dispatch-down. The scoring for Connection Method is effectively all-or-nothing: a project either gets the full 20 points or none. 20 points can be awarded to (i) a project sharing a site and grid connection with a wind or solar farm of at least 30 MW that is connected to the transmission grid; or (ii) a project with an existing standalone connection.
• Grid connection: the connection requirement at qualification has been relaxed: projects now need only a Connection Offer to qualify, with a Connection Agreement required by tender stage.
• Best and Final Offer (BAFO): EirGrid has added a new final stage to the tender, BAFO. The top-ranked projects will be shortlisted, and EirGrid will check whether each one can realistically be connected to the grid in time. To pass, a project must be expected to connect at least four months before the scheme starts, which leaves time for grid testing. Projects that cannot meet that date will be dropped. Those that pass can then lower their price in a final offer. This gives the shortlisted projects a final opportunity to sharpen their pricing once they know they are in contention. Preferred bidders will then have 30 business days to satisfy all conditions precedent and execute the LDES services contract.

Who Can Bid

The procurement is technology-neutral and runs in two stages: a qualification stage, followed by a scored tender. Projects must meet the following pass/fail eligibility criteria.

• Four hours, 1:1 ratio: at least 4 hours’ continuous import and export capability, with a 1:1 ratio of maximum export capacity to maximum import capacity;
• Set Size limits: a minimum capacity of 75MW for standalone projects or 20MW for hybrid projects, and a maximum of 100MW;
• Round-trip efficiency: For every 100 MWh the project takes from the grid, it must send at least 75 MWh back.
• Grid, planning and land: The project must connect to the high-voltage transmission grid (110 kV or above), not the lower-voltage local distribution network. It needs a grid connection offer from EirGrid to qualify, and a signed connection agreement by the time it tenders. It must also have final planning permission and must show that it has the legal right to use the land for the project and its grid connection.
• Proven technology: The project must use established technology that is already commercially available and has been deployed at several other grid-connected sites. Experimental, prototype or first-of-a-kind technologies are excluded. Hybrid sites must include at least 30MW of transmission-connected renewable generation. The CRU retained the 100MW cap, despite concerns, to limit concentration and delivery risk.
• Candidate Eligibility: Candidates must have a minimum financial turnover. The exact amount will be confirmed in the upcoming consultation on contractual arrangements. Candidates must have experience developing, delivering, owning or operating large-scale electricity or system-services projects. Candidates must meet cyber-security requirements. This includes holding a minimum level of insurance.

The Revenue Floor and Upside Sharing

Each bidder will bid the minimum annual income it needs, in €/MW/year, and successful bidders are guaranteed that amount. Bids cannot exceed a cap based on an independent estimate of the cost of providing storage (the Levelised Cost of Storage, or LCOS). The floor is fixed for the ten-year contract, adjusted for inflation. If revenues exceed the floor, the owner keeps 70% of the excess and the other 30% goes back to consumers as a reduction in network charges. Payments will be made quarterly and settled at year end. The ten-year term was kept despite most respondents saying it was too short.

The floor will be compared against the asset’s market revenues minus the cost of the electricity it buys to charge. All other costs, including operating, maintenance, network and financing costs, stay with the owner. The CRU considers that these costs are already allowed for in the LCOS cap, meaning that bidders must build them into their bids. The LCOS methodology is yet to be published.

The Trading Envelope

Each day at 10:00 am, EirGrid will set limits on when each asset can charge and discharge the following day. The limits are issued an hour before the Day-Ahead Market closes. Many respondents said this was too little notice, and the CRU has asked EirGrid to report on moving to an earlier time before go-live. This mechanism, previously called the “operational envelope”, is now the Trading Envelope. Outside those limits, assets can trade freely in all SEM markets. The Trading Envelope stops assets acting against the system’s needs, but it does not require them to operate. Assets that break the limits face penalties, and assets that trade materially less than expected will have their floor reduced (the “Trading Non-Activity Scalar”).

The CRU acknowledges that these elements pull in different directions. The floor weakens the incentive to earn market revenue, the Trading Envelope may block profitable trades, and the scalar penalises inactivity. Full approval therefore depends on EirGrid showing that they work together as a “coherent and financeable package”. The rules for setting the Trading Envelope must be published before tenders open and, together with the 10:00 issue time, set out in a separate Protocol Document. Significant changes to that document will need public consultation and CRU approval. The CRU is clear, however, that this process cannot be used to reopen the balance of risk once contracts are awarded.

Key Considerations for Investors and Developers

• Pricing the floor: The floor is measured against revenues after charging costs only. Bids must therefore cover every other cost, including network charges, degradation and financing. The LCOS bid cap has not been published, so bidders don’t yet know their pricing ceiling.
• Ongoing performance: Assets must achieve at least 75% round-trip efficiency and prove every year that they can still deliver their contracted power and duration. Degradation is therefore a compliance risk as well as a cost.
• Financeability: a ten-year term is short relative to LDES asset lives. Lenders will focus on scalar calibration, reconciliation timing, indexation and change control (i.e. the process EirGrid must follow to change the scheme’s operating rules after contracts are signed).
• Deliverability: the BAFO stage means connection programmes and planning status will be closely scrutinised. Protection for delay will be a key contractual point.
• Larger assets and future rounds: the 100MW cap and ten-year term effectively exclude large, long-life assets such as pumped hydro from this round. The CRU’s approval does not extend to future rounds, which will be informed by the outcomes of this one. The quantity and financial consultations under Actions 7 to 10 of the Electricity Storage Policy Framework (due by the end of 2028) will determine the longer-term need for LDES and whether dedicated support is required.

Next Steps

EirGrid will now consult on the contractual arrangements, including the Trading Envelope methodology, the Trading Non-Activity Scalar, the Deliverability Assessment and change control. A further EirGrid recommendation paper and CRU decision will follow, and tenders cannot be invited until these elements are finalised. The earlier indicative timetable targeted a procurement launch in Q1 2027 and contract awards in Q4 2027; the CRU expects updated timelines in the forthcoming consultation.

That consultation will be the last real opportunity to shape the terms against which bids are priced.

If you would like to discuss the decision or its implications for your project, please contact a member of our Energy & Infrastructure team.

Contributed by: Lorraine Kelly &Alex Needham