Compressed Air Energy Storage Market

Global Compressed Air Energy Storage Market Size (2024-2029):

The Global Compressed Air Energy Storage Market size was worth US$ 2.02 billion in 2023 and is anticipated to reach US$ 7.35 billion by 2029 from US$ billion in 2.51 in 2024, registering with a CAGR of 24% during the forecast period 2024-2029.

Current Scenario of the Global Compressed Air Energy Storage Market

Compressed air energy storage is primarily used to convert electrical energy into high-pressure compressed air that may be released later to drive a turbine generator to produce electricity. Moreover, compressed air energy storage (CAES) technology stores energy indefinitely by compressing air in an underground storage reservoir. As a result, it is cost-competitive with other utility-scale energy storage technologies required to serve huge loads. When power prices are low, excess power is taken from the grid and stored as compressed air. Then, to fulfill peak power needs or high price demands, compressed air is expanded. As a result, utilities are heavily investing in renewable energy and compressed air energy storage. CAES (compressed air energy storage) is a technique for storing compressed air in a sealed container. Storage allows users to supplement energy usage during peak demand periods, improve air quality, and preserve system stability in a compressed air system. Allowing the air to deflate through a turbine recovers the energy. In addition, the heat generated during expansion can be used to increase energy efficiency.

MARKET DRIVERS

Renewable energy integration with compressed air energy storage systems demonstration projects and technological advancements in compressed air energy storage systems are projected to boost market research over the projection period.

However, owing to several factors, including a lack of investment and technology, the demand for compressed air energy storage systems has remained underdeveloped, preventing the creation of new compressed air energy storage plants. Compressed air energy storage, battery storage, and pumped hydro storage are all common types of energy storage. However, pumped storage has a technical cost per unit of energy held of £50/kWh in terms of energy storage. In comparison, electrochemical storage costs per unit of energy stored of around £500/kWh. As a result, compressed air energy storage is appealing because the suggested technique costs £1-£10/kWh per unit of energy stored.

Furthermore, the co-location of renewable energy-producing facilities with energy storage assets is a fundamental driver of energy storage. This aids in the stabilization of electricity output, ensuring the grid's energy supply during peak demand periods. Therefore, the compressed air energy storage market is predicted to have a significant increase in market share during 2024-2029. CAES offers a broad range of advantages for energy storage in various applications and types. The most significant factors of compressed air energy storage include increased air quality, energy savings, fewer maintenance costs, longer shelf life, and improved pressure stability. In addition, CAES is primarily utilized to escalate storage capacity. As a result, it enables energy firms to deliver enough electricity for the entire service region without increasing energy output at peak periods.

CAES can reduce reliance on the electrical grid, lowering energy costs and overhead when used on a smaller scale. The added advantage of CAES is that it can store compressed air by removing the idea of buying and operating a separate compressor. Basically, CAES emits much less CO2 compared to various energy production technologies. In addition, emissions can be lowered to almost nil using adiabatic procedures. CAES reduces fossil fuel-powered grids' reliance, which helps in providing sustainable energy alternatives. CAES primarily helps in improving power grid stability when it acts as a supplement energy source. Most probably, it helps decrease emissions and can increase energy reliability, with the help of putting very much less demand on the electrical system. Compressed air energy storage enables more reliable and steady electrical output on a smaller scale. Another additional feature that propels the global compressed air energy storage market is, that when compared to other energy-generating methods, CAES devices require very little maintenance. When CAES indulges in small-scale energy generation, it further reduces compressor maintenance frequency and maintenance costs.

MARKET RESTRAINTS

The compressed air energy storage market is anticipated to be hampered by high capital costs and a lack of technological progress over the forecast period. These have a large storage capacity, making them ideal for wind energy applications; nevertheless, their main drawbacks are their high capital cost and the possibility of water loss due to evaporation.

REPORT COVERAGE

SEGMENTAL ANALYSIS

Global Compressed Air Energy Storage Market Analysis By Type

The diabatic type tends to hold the most prominent global compressed air energy storage market growth during 2024-2029. The diabatic compressed air energy storage facilities are a standard system in which the excess heat generated during the compression process is discharged into the atmosphere. As a result, natural gas is commonly used to create the requisite heat during power generation.

As a result, diabatic compressed air energy storage systems have lower efficiency. Despite being simple and considerably less expensive, they are less environmentally friendly than other forms of compressed air energy storage systems. The efficiency of diabatic compressed air energy storage devices is roughly 50%, much lower than the other emerging technologies. In addition, diabatic compressed air energy storage facilities have lower operating costs than adiabatic and isothermal air energy storage plants. As a result, diabatic plants are more profitable to run in general. On the other hand, diabatic plants are less environmentally friendly because they require gas to operate. Therefore, as worldwide concerns about climate change grow, various compressed air energy storage plants become more popular than diabatic plants.

REGIONAL ANALYSIS

North America dominated the global compressed air energy storage market during the forecast period.

With the rapid substitution of coal-based energy generation with natural gas, the US power sector is undergoing significant upheaval. As a result, Renewables integration has accelerated as costs have decreased and the massive environmental advantages have increased.

Asia Pacific region is estimated to develop at a significantly faster CAGR throughout the forecast period. Furthermore, the market in China, South Korea, India, and Japan is likely to grow substantially in the following years due to favourable government policies and laws that stimulate the use of renewable energy in these countries.

Europe is expected to be a critical region in the global compressed air energy storage market. The European Commission's focus on substantial long-term support for energy storage can be attributed to the high development of renewable energy and a significant increase in energy storage in Europe.

KEY PLAYERS IN THE GLOBAL COMPRESSED AIR ENERGY STORAGE MARKET

Companies playing a prominent role in the global compressed air energy storage market include Siemens Energy, General Compression, Hydrostor Inc., Bright Energy Storage Technologies, Pacific Gas and Electric Company, Apex Compressed Air Energy Storage, LLC, Ridge Energy Storage, Grid Services LP, ALACAES, Storelectric Ltd, LightSail Energy, and Others

RECENT HAPPENINGS IN THE GLOBAL COMPRESSED AIR ENERGY STORAGE MARKET

• Siemens announced that it would develop a thermal energy storage system for the integration of renewable energy integration. This is primarily utilized to offer high power, long duration, and high capacity energy storage range. 
• SustainX. Inc. and General Compression Inc. declared that they are going to sign the contract, including merging their firms to invent a new firm named GCX Energy Storage. Moreover, both firms have completed utility-scale projects, with a 2 MW by 300 MWh project in Gaines, Texas, and a 1.5 MW by 1 MWh project in Seabrook, New Hampshire.

DETAILED SEGMENTATION OF THE GLOBAL COMPRESSED AIR ENERGY STORAGE MARKET INCLUDED IN THIS REPORT

This research report on the global compressed air energy storage market has been segmented and sub-segmented based on type, and region.

By Type

• Diabatic 
• Adiabatic
• Isothermal

By Region

• North America 
• Europe 
• Asia Pacific
• Latin America 
• Middle East & Africa