The UK is set to build a GBP 11.2 million battery farm as a part of a demonstration project of electricity storage to alleviate peak time demand, Reuters reports.

UK Power Networks (UKPN), which owns and operates electricity cables and lines across southeast England, is installing around 240 tonnes of lithium-ion batteries in a specially designed building on a housing estate in Leighton Buzzard, a commuter town north of London.

The project, which is scheduled to begin operating in September, is jointly funded by UKPN and the Low Carbon Networks Fund, administered by the government’s Office of Gas and Electricity Markets.

Once it is fully operational, Leighton Buzzard will have the capacity to discharge up to 10 megawatt-hours (MWh) of power into the local distribution network at a rate of up to 6 megawatts (MW), enough for 6,000 homes.

The aim is to test the technical and financial feasibility of using storage to reinforce the power grid and help meet peak loads as an alternative to the conventional approach of installing more substations and overhead power lines.

UKPN puts the capital cost of the battery scheme at Leighton Buzzard at 11.2 million pounds ($18.82 million), compared with 6.2 million pounds for conventional reinforcement, with an extra overhead power line and another transformer.

“On a pure capital expenditure basis, energy storage can seldom compete with conventional options,” the company admitted in a presentation back in 2011.

But the company hopes that battery storage could become more economic in future if costs come down with more experience.