Dive Brief:
- Global long-duration energy storage installations saw a stunning rise of 49% in 2025, reaching over 15 GWh, as reported by Wood Mackenzie. The majority, about 93%, of these installations are in China. This growth is largely driven by strong governmental support for technologies that can deliver sustained power for over four hours.
- The largest contributions to new installations came from compressed air energy storage (45%), thermal storage (33%), and vanadium redox flow batteries (21%). Despite this growth, long-duration storage represents only 6% of all energy storage installations.
- However, the future of long-duration storage remains uncertain. Wood Mackenzie indicates that while last year showcased impressive growth in installations, these technologies are facing heavy competition from lithium-ion batteries, which dominate the short to mid-range storage market.
Dive Insight:
Long-duration energy storage is vital for achieving net zero emissions, according to the same report. The average duration of global energy storage needs to expand from about 2.5 hours to roughly 20 hours to keep the grid stable as renewable energy sources become more common.
Currently, lithium-ion batteries usually provide around two hours of storage, whereas vanadium redox flow batteries and compressed air energy storage can manage about four hours, and thermal storage can last around eight hours. However, lithium-ion technologies are quickly becoming more competitive even in longer storage durations due to falling prices and efficient supply chains.
“The significant cost reductions achieved by lithium-ion batteries over the past decade will be challenging for new long-duration energy storage technologies to match,” noted Priya Shrivastava from Wood Mackenzie.
Wood Mackenzie projects that lithium-ion batteries will capture 85% of the energy storage market by 2034, while vanadium redox flow batteries and compressed air energy storage are expected to hold only 5% and 3%, respectively.
Emerging long-duration technologies may be best suited for applications requiring multi-day or seasonal storage. However, the market for extended storage suffers from a lack of demand and necessary pricing mechanisms, making ongoing policy support essential.
Despite a wave of investment in these technologies in recent years, interest has since waned, with funding for long-duration energy storage dropping by 30% globally in 2025. Venture capital investments plummeted by 72%.
Still, some large projects are advancing towards commercialization in the U.S. For instance, Hydrostor secured nearly $1.8 billion from the U.S. Department of Energy for its advanced compressed air energy storage systems.
Hydrostor aims to start work on its Willow Rock Energy Storage Center, which will have a capacity of 500 MW/4 GWh, later this year after obtaining necessary federal approvals.
In another significant move, Google and Xcel Energy announced their partnership with Form Energy to deploy large-scale batteries, marking it as the largest battery project by energy capacity globally.
As states like California look to expand long-duration energy storage, upcoming regulations are pushing utilities to explore these options more seriously. Xcel Energy sees long-duration storage as a critical component in meeting future renewable energy goals set by state legislation.