April 20, 2026 | China Energy News, Page 05 (International News)
By Li Limin
New data released recently by energy research firm Wood Mackenzie shows that global installed capacity of long-duration energy storage (LDES) exceeded 15 GWh in 2025, marking a year-on-year surge of 49%. China accounts for 93% of the world’s cumulative LDES capacity, taking the undisputed global lead. As countries forge ahead with low-carbon energy transition, stable and reliable energy storage systems grow increasingly critical, and long-duration technologies represented by flow batteries and compressed air energy storage (CAES) have drawn mounting industry attention. Industry insiders call for rational pricing mechanisms anchored in sound policy frameworks to guarantee returns for storage projects and sustain long-term market prosperity.
China Continues to Lead Global Capacity Growth
Wood Mackenzie’s statistics reveal that bolstered by robust mandatory storage matching policies and rapid expansion of renewable power installations, China’s rollout of long-duration energy storage outpaces all other nations by a wide margin in 2025.
Driven by falling costs and technological advances, lithium-ion batteries have emerged as the most competitive storage technology and dominate the commercial energy storage market. Unlike lithium-ion systems, long-duration energy storage can store and dispatch power for over four hours, and in extreme cases, multiple days. It delivers significant grid regulation for power systems dominated by intermittent wind and solar generation, while cutting reliance on backup fossil fuel power plants.
Industry consensus holds that no single storage technology can address all use cases amid skyrocketing global renewable capacity. Diverse application scenarios demand differentiated storage solutions, creating vast room for multiple technical pathways and expanding the market for long-duration technologies such as flow batteries and thermal energy storage.
Market research firm GMI estimates the global LDES market reached approximately USD 3.6 billion in 2025; the figure is projected to rise to USD 3.9 billion this year, and further expand to USD 9.5 billion by 2035 at a compound annual growth rate (CAGR) of 10.5%.
Wood Mackenzie’s report adds that among all newly commissioned global LDES projects in 2025, CAES accounts for 45%, thermal storage 33%, and vanadium flow batteries 21% — these three technologies represent the fastest-growing long-duration storage routes today.
Soaring Industry Focus on Long-Duration Storage
Nations worldwide are accelerating shifts toward low-carbon power grids, spurring constant technological breakthroughs in long-duration storage. In January this year, Xinjiang Jimsar all-vanadium flow battery energy storage station, China’s largest facility of its kind, achieved full-capacity operation. With a rated power of 200 MW and energy capacity of 1,000 MWh, the project marks a landmark breakthrough in China’s deployment of large-scale, long-duration storage technology.
Long-duration storage projects are also being rolled out rapidly across the globe. Last June, the European Commission approved a support scheme for large-scale energy storage in Spain, allocating around EUR 700 million for thermal storage, battery storage and other assets. Over half of Spain’s installed power capacity comes from renewables, and the large-scale storage rollout will effectively smooth generation volatility.
In January this year, the California Energy Commission announced plans to complete a 500 MW compressed air energy storage facility within the year to store surplus local solar power.
Furthermore, energy industry players are actively scaling LDES applications, viewing long-duration storage as a vital remedy for stabilizing grids with high renewable penetration. In January, industry bodies including the Global Long-Duration Energy Storage Council and European Flow Battery Association co-signed an open letter to the EU, urging accelerated deployment of long-duration storage technologies under EU-wide policy frameworks. The letter notes Europe faces bottlenecks in energy system planning, market design and investment frameworks. To boost energy security and cut overall power system costs, EU institutions and policymakers must accelerate the integration of long-duration storage assets into regional energy systems.
Decarbonization Drives Sustained Long-Term Demand
The global energy storage sector has expanded at breakneck speed in recent years. Latest data puts 2025’s newly installed global storage capacity above 100 GW, a 40% year-on-year increase. Even so, the industry widely agrees that LDES deployment must expand far faster to meet long-term global energy transition targets.
Wood Mackenzie states long-duration storage currently makes up only 6% of total global storage capacity. Under net-zero emission scenarios, the average discharge duration of global energy storage assets must rise from the current 2.5 hours to 20 hours. For countries with renewable penetration exceeding 50% — such as Germany, Australia and Denmark — accelerated LDES deployment is indispensable for grid stability, indicating massive untapped demand for long-duration storage solutions.
Wood Mackenzie forecasts lithium-ion batteries will remain the market mainstream through 2034 with roughly 85% market share, while vanadium flow batteries and CAES are projected to capture 5% and 3% respectively. A wider range of long-duration technologies will also move from laboratory R&D to large-scale commercial rollout.
Despite robust global demand for LDES, securing stable, reasonable returns amid volatile electricity prices remains a core industry priority. The joint letter to the EU highlights that policy frameworks must guarantee viable project revenue streams and introduce dedicated capacity mechanisms tailored to long-duration storage systems. The UK government recently released incentive policies for LDES projects, setting upper and lower revenue thresholds to deliver financial certainty for developers.
Wood Mackenzie also issues a cautionary note: competition in the storage market is intensifying, and long-duration storage systems still carry higher upfront costs compared with lithium-ion alternatives. Meanwhile, lithium-ion manufacturers are refining their technologies to extend discharge durations, meaning LDES will face fiercer rivalry in the years ahead. In addition, most global long-duration storage technologies remain in demonstration phases. Without fundamental market design reforms across nations, new long-duration storage technologies will encounter major barriers to full commercialization and mass scaling.
A very good article.