by Shane Henson — January 13, 2014—Driven by growing penetration of intermittent renewable energy, increasingly constrained grid conditions, and the need for investments in electricity infrastructure, the market for compressed air energy storage (CAES) is forecasted to grow, according to a recent report from Navigant Research, a market research and consulting team that provides in-depth analysis of global clean technology markets.
Per the report, Compressed Air Energy Storage, in Asia Pacific, Europe, and North America, new installations of CAES are expected to increase steadily over the next 10 years, and the new system installation revenue for CAES will reach $4.8 billion annually by 2023.
“With a total of 400 megawatts installed worldwide, CAES is the second most prevalent form of energy storage on the grid today after pumped hydro,” says Kerry-Ann Adamson, research director with Navigant Research. “At the same time, higher-efficiency next-generation CAES technology, which promises modular and scalable above-ground CAES, is also nearing commercialization.”
Next-generation isothermal, or adiabatic, CAES, which can be sited anywhere and conveniently scaled using modular units, will address the locational and scalability constraints faced by traditional CAES, according to the report. Due to those constraints, CAES development has largely been dormant for the past several years, and some high-profile proposed projects have been abandoned due to geological uncertainty or a lack of sufficient forecast revenue.
The report analyzes the global market opportunity for both traditional underground CAES and next-generation CAES technologies across five key application segments: wind energy integration, solar energy integration, grid asset optimization, transmission and distribution deferral, and ancillary services. The report provides a comprehensive assessment of the demand drivers, policy factors, and technology issues associated with the market for CAES. Key industry players are also profiled, and worldwide capacity and revenue forecasts, segmented by application, technology, and region, extend through 2023.
