The energy consumption in 2018 grew by 2.9%, which is almost two times the last 10 years’ average of 1.5%, as per BP PLC, one of the oil and gas supermajors. The Energy Information Administration (EIA) of the U.S. presents a similar scenario for the next 20 years, claiming that the worldwide electricity demand would rise by around 28% by 2040. Such increase in energy usage is not only raising carbon emissions (much of the electricity is still produced from fossil fuels), but also putting immense pressure on the grid.

In order to reduce the workload of power plants and grids and ensure a demand–supply balance, novel technologies are being developed, such as thermal energy storage. From $3,000.9 million in 2017, the global thermal energy storage market is expected to advance at a CAGR of 15.9% during 2018–2023, to $7,472.9 million in 2023. The technology helps store extra thermal energy, so that it can be fed to the grid during periods of peak electricity demand. Concentrated solar power (CSP), pumped heat electrical storage (PHES), ice thermal energy storage, and chilled water thermal energy storage are the various ways of storing the thermal energy.

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Among these, CSP was the most popular way to do so during 2013–2017, and the same scenario is predicted for the forecast period. This is because the technology can be used for power generation as well as for heating, ventilation, and air conditioning (HVAC) applications, which is why the number of CSP plants is rapidly increasing. For instance, the National Energy Administration of China reports that 111 CPS plants, with a total generation capacity of 9 gigawatts (GW), are under development in the country. Similarly, in India too, two CSP plants, with a cumulative 225-megawatt (MW) capacity, are being constructed.

The government in other countries is also stepping up efforts to increase the adoption of the technology. For example, in Texas, U.S., under the Property Assessed Clean Energy (TX-PACE) program, the government offers cost-effective, long-term finance to end users for the integration of energy efficiency systems, such as those which store thermal energy, in solar power generation equipment. This way, users can not only use the extra power, thereby reducing the load on utility firms, but also feed it into the grid, to help bridge the demand–supply gap.

Along with for power generation, the installation of thermal energy storage systems is also growing on account of the rising requirement for HVAC equipment. As independent heating and cooling systems are limited, the usage of district heating and cooling (DHC) systems is increasing. These systems depend on power distribution companies, which is why the installation of thermal energy storage plants for district HVAC applications is growing.This not only results in instant heat availability, but also reduced burden on utility firms and the grid.

Across the globe, North America is the largest user of this technology, owing to the increasing installation of CSP plants and growing power backup demand for HVAC applications, primarily in the U.S. This is also why within the region, the thermal energy storage market in the U.S. is larger. During the forecast period, the fastest market growth is expected in Asia-Pacific (APAC), because of the huge potential of India and China for generating electricity from CSP systems.

Hence, as the demand for power and the carbon emissions from its production grow, so will the adoption of thermal energy storage systems.