Pumped Hydro Storage Market Analysis

Pumped Hydro Storage Market Analysis

Open-loop hydro storage systems segment is forecast to witness over 3% growth rate through 2028. Ongoing government initiatives toward renewable energy generation and the introduction of favorable regulations & policies pertaining to environmental emissions will complement the pumped hydro storage market outlook.
 

Closed-loop pumped hydro storage systems are anticipated to see prominent growth on account of minimum environmental impact across natural habitats coupled with the availability of non-connected water streams. Isolated reservoirs that have no direct connection with natural water supply will enhance the product deployment. Additionally, the non-availability of freshwater resources and fossil fuels combined with high hydropower potential will accelerate the industry prospects. Furthermore, the growing necessity for grid stabilization and peak load management will drive the segment growth.
 

The Asia Pacific pumped hydro storage market size will experience a cumulative installation of more than 170 GW by 2028. The accelerating economic growth followed by favorable government initiatives toward the deployment of sustainable electrical networks will boost the regional market growth. Growing concerns toward the security of power supply in line with the ongoing integration of PHS systems to ensure power quality will further enhance the industry statistics. Moreover, the rapid expansion of renewable networks in areas with limited grid access and rising investments from financial institutions including the Asian Development Bank and IFC will positively sway renewable energy adoption.
 

The China market revenue is predicted to rise through 2028 owing to increasing electricity demand from industrial establishments along with promising regulatory policies toward the PHS sector development. For instance, as per the NEA, the Government of China issued a long-term development plan from 2021 to 2035 for the expansion of the country’s pumped storage hydropower volume to 62 million kilowatt-hours (kWh) at the end of 2025, which is a part of the efforts to propel clean energy and reach carbon emission reduction goals. Moreover, rapid investments and commercialization across residential and utility-based electrification units will fuel the Chinese PHS industry expansion.
 

Despite the pandemic outbreak, the industry has not observed any decline due to no government prohibitions toward the refurbishment of hydropower systems followed by the commencement of pumped hydro storage projects. Moreover, several pumped hydro storage projects were operational as per the schedule and new project launches were observed. However, ongoing government efforts to effectively deal with the pandemic situation coupled with ongoing vaccination drives and reviving of the global economies will positively sway the industry outlook.
 

Mergers, strategic implications, joint ventures, and product innovations to strengthen the product portfolios of various prominent players will stimulate the industry statistics. For instance, the company secured an order worth USD 1.18 million to develop an advanced closed-loop system for the HydroNEXT initiative of the country. Furthermore, the product resulted in approximately 30% decrease in the project costs along with over 40% savings in the construction cost.