We investigate the dynamics of Rydberg electrons excited from the ground state of ultracold atoms trapped in an optical lattice. We first consider a lattice comprising an array of double-well potentials, where each double well is occupied by two ultracold atoms. We demonstrate the existence of molecular states with equilibrium distances of the order of experimentally attainable inter-well spacings and binding energies of the order of 10^3 GHz. We also consider the situation whereby ground-state atoms trapped in an optical lattice are collectively excited to Rydberg levels, such that the charge-density distributions of neighbouring atoms overlap. We compute the hopping rate and interaction matrix elements between highly-excited electrons separated by distances comparable to typical lattice spacings. Such systems have tunable interaction parameters and a temperature ~10^{-4} times smaller than the Fermi temperature, making them potentially attractive for the study and simulation of strongly correlated electronic systems.
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