July 15, 2024
Pumped Hydro Storage Market

Rising demand for electricity storage to drive the growth of Pumped Hydro Storage Market

The global Pumped Hydro Storage Market is estimated to be valued at US$ 348.25 Bn or $348.25 billion in 2023 and is expected to exhibit a CAGR of 6.9% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Pumped hydro storage involves using surplus electricity or cheaper off-peak electricity to pump water from a lower dammed reservoir to a higher storage reservoir. This stored water can later be released back into the lower reservoir through turbines during peak demand periods to generate electricity. Pumped hydro storage has been proven as a reliable, long-lasting and affordable option for large-scale energy storage with its ability to generate flexible power within minutes. It helps in balancing intermittent renewable energy sources like wind and solar power by storing excess wind and solar energy that is generated at times of low electricity demand and releasing it when demand is high.

Market Overview:
The pumped hydro storage market involves key components like pumps, turbines, reservoirs, canals, tunnels and pipes. These components work together to efficiently store potential energy in the form of water and convert it back to electricity whenever required. Pumped hydro storage helps power utilities meet peak demand periods at affordable rates by providing dispatchable power, ancillary services like frequency regulation, voltage control and black start capability. Countries are increasingly investing in pumped hydro storage projects to support green energy transitions and decarbonization goals by enabling higher integration of renewable energy sources.

Market key trends:
Rising demand for electricity storage is a key trend boosting the pumped hydro storage market growth. With growing deployment of intermittent renewable energy, there is increasing need for large-scale energy storage technologies to balance power supplies. Pumped hydro storage is hugely scalable and can store significant amounts of energy at low costs. Another trend is the refurbishment and expansion of existing pumped hydro storage plants. Several plants worldwide are undergoing upgrades with advanced technologies to boost their storage capacities and efficiencies. Governments across countries are also announcing supportive policies and incentives for developing new pumped hydro storage projects. For instance, the US Department of Energy invested $64 million in 2019 to advance pumped storage hydropower technologies. These trends point towards strong outlook for the pumped hydro storage market over the coming years.
Porter’s Analysis
Threat of new entrants: The threat of new entrants is moderate as pumped hydro storage projects require massive infrastructure and large capital investments. Initial setup costs act as a barrier for new players.

Bargaining power of buyers: The bargaining power of buyers is moderate. Buyers can negotiate on project costs and get competitive bids, but their options are limited to a few global players who can execute such large-scale projects.

Bargaining power of suppliers: The bargaining power of suppliers is low to moderate as key components and materials can be sourced from multiple suppliers globally. However, technology providers have some control over pricing and supply.

Threat of new substitutes: Alternate energy storage technologies like batteries, compressed air energy storage, and flywheels pose a moderate threat as substitutes. However, pumped hydro remains the most economical large-scale energy storage solution currently.

Competitive rivalry: Intense as global players compete for large-scale projects globally to gain scale and market share.

Key Takeaways

The global Pumped Hydro Storage Market Share is expected to witness high growth, exhibiting CAGR of 6.9% over the forecast period 2023 to 2030, due to increasing demand for utility-scale energy storage from the renewable energy sector. Pumped hydro storage remains the most economical and sustainable option to balance the intermittent power supplies from renewable sources like solar and wind.

Regional analysis: Asia Pacific dominates the global market currently accounting for around 35% share, with China being the largest pumped hydro storage market globally. APAC is projected to maintain its lead, growing at a CAGR of over 7% during the forecast period driven by increasing investments in renewable energy and rising focus on grid reliability and stability in major economies. Europe is another key regional market favored by supportive regulatory policies for energy storage in countries like the UK, Germany, Norway, and Switzerland.

Key players: Key players operating in the pumped hydro storage market include operators like Duke Energy Corporation, EON SE, Enel SPA, Electricite de France SA, and Iberdrola SA as well as technology providers like General Electric Company, Siemens AG, Andritz AG, Mitsubishi Heavy Industries, Ltd, Voith GmbH & Co. KGaA, and Ansaldo Energia SpA. Major players are focusing on developing innovative solutions to increase storage capacity and efficiency. They are also collaborating with utilities and investment firms to bid for large-scale pumped hydro projects globally.

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