February 21, 2024

Global Thermal Energy Storage Market Poised for Strong Growth

Thermal energy storage technologies provide continuous opportunities for residential and commercial buildings owners to reduce energy costs by 30-50%. By capturing and reusing wasted heat and cold, thermal energy storage helps decarbonize our energy system.

The global Thermal Energy Storage Market is estimated to be valued at US$ 5.67 Billion in 2024 and is expected to exhibit a CAGR of 10% over the forecast period 2024 to 2031, as highlighted in a new report published by Coherent Market Insights.

Introduction to the Market

Thermal energy storage (TES) refers to technologies that store thermal energy by cooling or heating a storage medium so that the stored energy can be used at a later time for cooling and heating applications. TES helps utilize energy from renewable and less expensive off-peak sources to displace higher cost on-demand generation.

Market Dynamics

The growth of the global thermal energy storage market is driven by the increasing need for renewable energy integration and decarbonization of the energy system. Thermal energy storage helps mitigate the intermittency of renewable energy sources like solar and wind by storing excess energy produced during off-peak hours and supplying it when needed. This improves grid reliability and allows for greater renewable energy penetration. Government policies and incentives promoting the adoption of TES technologies will further accelerate the market growth over the coming years.

Market Challenges

Some key challenges faced by the thermal energy storage market include high initial costs associated with thermal energy storage installations, limited storage capacity and scale-up challenges. Thermal energy storage systems require significant capital investments which increases the overall project costs. Further, the storage capacities of existing technologies are still limited which hampers their large-scale commercial and industrial applications. Rapid scale-up of these systems presents technical hurdles around operational stability and performance consistency over long runtimes.

PEST Analysis

  • Political: Favorable government policies around renewable energy targets and subsidies for thermal storage adoption can boost market growth. However, inconsistent policy support impacts investment decisions.
  • Economic: Stronger economic growth drives higher energy demand raising the need for utility-scale storage. But high initial costs remain a barrier.
  • Social: Growing environmental awareness and focus on sustainable alternatives is increasing acceptance for thermal storage solutions.
  • Technological: Rapid advancement in materials, phase change materials and other storage mediums is expanding application scope. But further innovation is needed to improve roundtrip efficiencies and reduce costs.

Geographical Regions

North America held the largest share of the global thermal energy storage market in 2024 due to strong presence of key players and supportive government policies for renewable integration in the region. Asia Pacific is expected to witness the fastest growth during the forecast period owing to increasing investments in sustainable energy initiatives across developing nations like China and India to meet rising power demands.

Key Takeaways

Growing demand for utility-scale storage: Thermal energy storage plays a key role in maintaining grid stability by shifting renewable energy generation to meet peak demand periods. Rapid capacity additions of solar and wind farms are propelling the need for large-scale thermal storage installations across utilities.

Global expansion: Leading manufacturers are exploring opportunities in emerging markets through technology partnerships, joint ventures and acquisitions to expand global footprints. Growing investments in sustainable energy infrastructure in Asia and Latin America will accelerate commercialization.

Technological advancements: Ongoing research on new phase change materials, thermal batteries, thermo-chemical energy storage and other innovations aim to significantly enhance storage densities, cyclability and reduce costs. Such improvements will broaden the applications of thermal storage across various end-use industries.

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it