December 10, 2022: Commitments have been made to invest more than $58 billion in long duration energy storage (LDES) projects around the world since 2019, according to analysis released on December 7 by Wood Mackenzie.
If all of the pledges made by governments and companies went forward, it would lead to the installation of 57GW of LDES projects — equivalent to three times the global energy-storage capacity deployed in 2022, says Wood Mac’s Long-duration energy storage report 2022.
The report says projects representing $30 billion are already either under construction or in operation.
However, most LDES technologies are still nascent and developers will “struggle” to scale cost-effectively before 2030.
The report also shows what are described as clear geographical disparities in the development of the LDES market. For the Asia Pacific region, the deployment of vanadium redox flow batteries and compressed air energy storage has accelerated rapidly in China, which has been largely driven by strong policy support.
Kevin Shang, senior research analyst at Wood Mac and report lead author said: “In the western hemisphere, the US continues to invest in and build its LDES industry, with companies actively pushing for innovation, and promoting pilot and demonstration projects.”
By contrast, most European countries have been less enthusiastic, says Shang, although the UK government has been an exemption, as it explores the role LDES technologies have to offer, while actively seeking to support industry players.
“Long-duration energy storage technology, with longer durations of eight to approximately 100 hours, holds great promise as a low-cost solution to enable a grid with more renewable sources.”
Wood Mac says support from governments is needed to help lower upfront capital costs, provide revenue certainty, and “generate market signals for investment” and the broader deployment of projects.
However, companies need to create new business models to attract private investors with a view to making profits without subsidies in the long term.
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