A £246 million Government programme to boost battery technology has been welcomed as paving the way to a lower cost and cleaner energy system.
Business Secretary Greg Clark said the aim is to ensure the UK leads the world in the design, development and manufacture of electric batteries, which can help store energy from renewables and balance the grid.
Known as the Faraday Challenge, the four-year investment round is a key part of the Government's Industrial Strategy.
It will deliver a programme of competitions that will aim to boost the research and development of battery technology.
The first phase of the £246 million investment is being launched after analysis published last year suggested that deploying "flexible technologies" including batteries and smart grids could save the UK energy system £17-40 billion by 2050.
Electric batteries could play a key role in the power grid, for example by storing electricity from intermittent renewables such as solar panels for when it is needed, alongside efforts to balance demand by consumers and industry such as briefly powering down home appliances or manufacturing.
They will also play a significant part in helping cut carbon emissions from transport, as traditional vehicles are replaced by electric cars and vans.
James Court from the Renewable Energy Association said: "The global market is quickly moving towards a decentralised model, relying less on large fossil generation and more on flexible and increasingly cheap renewable sources.
"More energy storage empowers this and will lead to a lower cost, lower carbon energy system that will benefit households and businesses across the country.
"The launch of a battery institute will help guide next-generation storage technologies through the hazards that lay between a good idea in a lab and actual deployment in homes and on solar farms."
Gareth Redmond-King, head of climate and energy at WWF, said battery storage was a "game-changer" in the ability to produce clean power from renewables.
"These technologies give us flexibility to run on solar when the sun isn't shining, and be powered by wind when it is still.
"It will support the transition to electric cars and enable our homes to be more efficient - which means cheaper, as well as cleaner and greener energy."
He added that the investment was only one piece in a much bigger jigsaw for cutting carbon from the economy, and said the Government urgently needed to publish its clean growth plan.
Hannah Martin, head of energy at Greenpeace UK, said the announcement was a sign of the "modern, smart and flexible energy system we are moving towards".
"Innovation in battery technology will support the electric vehicle revolution, tackling lethal air pollution, and complementing renewables and energy efficiency," she said, and urged the Government to increase support for "ever-cheaper" wind and solar to make the most of the shift.
However, shadow business secretary Rebecca Long-Bailey claimed the announcement was a "damp squib".
"The Government's promise of investment in battery technology is simply a re-announcement of funding promised back in April as part of the Industrial Strategy Challenge Fund, and their record of supporting emerging green industries is abysmal," she said.