The Global Pumped Hydro Storage market is projected to grow at a CAGR of around 6.27% during the forecast period of 2023-28, says MarkNtel Advisors in their recent research report. The major factors contributing to the market growth are the growing incorporation of renewable energy sources, expanding industrialization, the rising emphasis on bringing electricity to rural regions, and the ongoing construction of smart grid systems.
Electricity shortage is a major problem worldwide, and the soaring demand for renewable energy sources in various industries, such as residential, commercial, government, transport, and industrial sector, fuel the market growth. However, the installation of pumps, turbines, and upper & lower reservoirs all need considerable upfront investments, which is one of the major barriers to the adoption of this storage system.
Furthermore, growing manufacturing industry, like the rising production of e-vehicle globally due to rising fuel prices & environmental concerns, this system allows extra energy to be stored during low demand or high production times & then released back into the grid when needed by the manufacturing industry to fulfill the requirement of e-vehicle globally, making it less expensive for large-scale energy storage & having a significantly longer technological lifespan.
Along with this, technological innovation is a key trend gaining popularity in the market, including Dynamic Pumped Hydro storage, which is similar to traditional ones that stores & generates electricity using the difference in elevation between two reservoirs. However, it also includes a small turbine generator & a battery that enable it to quickly adapt to changes in supply & demand, which shortens the time it takes to provide electricity for end-users such as manufacturing, construction, and residential.
In the traditional method, the lead time is much higher, and also the evaporation & conversion loss is greater. Due to more heightened demand from the manufacturing & construction sectors owing to rapid urbanization & smart home adoption, the market is gaining traction in the coming years, further states the research report, “Global Pumped Hydro Storage Market Analysis, 2023.”
Rapid Adoption of Closed-loop System to Drive the Market Growth
Based on the system, the market is bifurcated into the Open-loop System & Closed-loop System. Among them, the Closed-loop system secured the largest share in the previous years & is anticipated to follow the same trend during the forecast period as they can reuse the water in the system more than once, making them more efficient & environmentally friendly. Additionally, there are several places where closed-loop systems might be used, like underground, providing site possibilities & perhaps lessening the impact on the environment.
Furthermore, with the ever-growing concern about the environment & aquatic life, closed-loop systems can be off-river, thereby avoiding ecological impacts on riverine fishes & other aquatic biotas. Since closed-loop PSH systems, are not often linked to flowing water, they typically have less influence on the environment than open-loop PSH systems, hence would accelerate the growth of the closed-loop system in the market during the forthcoming period
With Upcoming New Projects & Investment, Asia-Pacific to Dominate the Global Market
On the geographical front, Asia-Pacific captures the potential shares of the Global Pumped Hydro Storage market due to rapid economic growth in the region, which leads to influence the investment in infrastructure & energy projects. The mid- & long-term plans for the development of this system from 2021 to 2035 were announced by China's National Energy Administration (NEA) in September 2021.
This plan projects that the installed pumped storage hydropower capacity would be at least 62 GW in 2025 & roughly 120 GW in 2030, compared to 75% of the current existing pumped storage capacity worldwide. Hence, the upcoming projects & favorable government policies have led to increased investment in the renewable sector, further driving the market in the following years.
With strategic initiatives, such as mergers, collaborations, and acquisitions, the leading market players, including (ANDRITZ HYDRO GmbH, Voith GmbH & Co. KGaA, Siemens, GE Renewable Energy, ABB Ltd., Alstom Hydro France, Mitsubishi Electric Corporation, Toshiba Corporation, Hyundai Heavy Industries Co., Ltd., Hitachi Energy, Dongfang Electric Corporation, Harbin Electric Company and others) are looking forward to strengthening their market position.
Key Questions Answered in the Research Report