Visiongain has published a new report entitled Long-Duration Energy Storage (LDES) Market Report 2026-2036 (Including Impact of U.S. Trade Tariffs), providing detailed forecasts by storage duration, deployment model, storage medium, application and technology, alongside regional and leading national market analysis.

Visiongain estimates the market at US$6.34 billion in 2026 and is projects a CAGR of 13.8% during the forecast period 2026-2036.

Impact of US Trade Tariffs on the Global Long-Duration Energy Storage (LDES) Market   

U.S. trade tariffs on energy-related equipment, critical minerals, and battery components have emerged as a significant external factor influencing the global Long-Duration Energy Storage (LDES) market. These tariffs primarily affecting lithium-ion batteries, power electronics, steel, aluminium, and certain electrochemical components have altered cost structures, supply chain strategies, and investment decisions across the LDES value chain. While many LDES technologies aim to reduce reliance on lithium-ion systems, several still depend on globally sourced materials and components that are exposed to U.S. trade policies. From a global perspective, U.S. tariffs have created short-term cost inflation, particularly for electrochemical and modular LDES systems, while simultaneously accelerating regional manufacturing localization and diversification of supply chains. The long-term impact of tariffs on the long-duration energy storage (LDES) market depends on how quickly manufacturers adapt, how governments respond with incentives, and how rapidly alternative technologies such as mechanical, thermal, and chemical LDES scale commercially. Scenario-based recovery pathways (V-shaped, U-shaped, and L-shaped) provide a useful framework to assess these impacts.

Government “Storage Shot” Programs and Targeted Subsidies Compressing the Cost Curve

A second powerful driver is the emergence of storage-specific industrial policy, with the U.S. Department of Energy’s Long Duration Storage Shot being the flagship example: it targets a 90% reduction in the cost of grid-scale storage that can deliver 10+ hours by 2030, relative to 2020 baselines. This is catalysing billions of dollars in R&D, demonstration grants and loan guarantees across CAES, LAES, thermal and advanced electrochemical systems, while complementary policies like the Inflation Reduction Act’s investment tax credits for standalone storage improve project economics for early movers. In the UK, Highview Power’s 300 MWh LAES plant at Carrington and its larger Hunterston “stability island” and storage project have attracted more than £430 million of capital combined, backed by the UK National Wealth Fund, Centrica, Rio Tinto and Goldman Sachs, underpinned by government-backed cap-and-floor revenues for long-duration stability services. Across Europe and parts of Asia, similar mechanisms, capacity payments, contracts for difference and network-regulated returns, are being tailored to LDES, reducing perceived technology and revenue risk and compressing payback periods. This alignment of policy, public funding and private capital is shortening time-to-bankability for new technologies and driving market formation much faster than organic merchant revenues alone could.

What are the Current Market Drivers?

Rapid Technology Diversification from “4-Hour Li-ion” to a Portfolio of Multi-Day Solutions

Historically, grid storage was synonymous with 2–4-hour lithium-ion systems, but current LDES growth is being driven by a much more diverse technology stack, each filling a different duration and use-case niche. Iron-air batteries from Form Energy are designed to store energy for up to 100 hours at system costs competitive with legacy thermal plants; the company has broken ground on several multi-day projects in the U.S. Midwest and is expanding a dedicated factory in West Virginia. Flow battery specialists such as ESS Tech and Invinity provide 6–12-hour systems, with ESS winning contracts from Sacramento Municipal Utility District and Salt River Project for multi-hour iron-flow systems aimed at long-duration resiliency and microgrids. Mechanical and thermal innovators like Highview Power (LAES) and Rondo/Antora (high-temperature thermal storage) are targeting multi-day applications and industrial heat, while traditional pumped-storage hydro and emerging CAES/LAES provide very large-scale bulk LDES where geology allows. This technological pluralism means customers can increasingly match duration, efficiency, cycling profile and capex to specific value streams, which expands the addressable market and reduces dependence on any single technology’s cost curve.

Growing Grid Congestion, Curtailment Costs and T&D Deferral Needs

Another major driver is the rapid rise in curtailment of renewables and grid congestion, which creates a strong economic case for long-duration storage as a non-wires alternative. In markets like the UK, Denmark, Germany and parts of the U.S., wind and solar farms are frequently curtailed when transmission lines are congested or demand is low, leading to large “constraint payments” from system operators to generators; long-duration storage can absorb these surplus MWh for later use, avoiding both the waste of clean energy and the cost of curtailment. Highview’s projects in Manchester and Hunterston are explicitly justified on the basis of reducing curtailment of offshore wind and easing north–south transmission bottlenecks in Britain, providing stability and inertia services while shifting energy over many hours or days. Similarly, studies for U.S. states such as Virginia highlight that LDES can help defer or avoid expensive T&D upgrades by acting as a flexible “virtual line” that stores energy during low-flow periods and releases it during peak congestion. As grids become more heavily electrified, with EVs, heat pumps and data centers, these congestion and capacity challenges intensify, making the locational and multi-use nature of LDES increasingly attractive to planners and regulators.

Where are the Market Opportunities?

Multi-Day and Seasonal Storage as a New Asset Class for Deep Decarbonization

One of the most attractive opportunities is the emergence of multi-day and seasonal storage as a distinct asset class, filling gaps that 4-hour batteries and even traditional pumped hydro cannot cost-effectively cover. Modelling work in transmission-constrained systems shows that multi-day and seasonal LDES can dramatically reduce overall system costs by smoothing both intra-week variability and seasonal swings without excessive overbuild of renewables or reliance on fossil backup. Form Energy’s 100-hour iron-air projects with Great River Energy, Georgia Power and Xcel Energy are early proofs of concept, designed to provide coal-replacement capacity and manage extended weather events, while Highview’s LAES plants are marketed not just as grid-stability assets but as multi-day energy reservoirs. As more system operators confront multi-day “dunkelflaute” periods and winter reliability challenges, specialised tariffs and capacity products for multi-day and seasonal storage are likely to emerge, creating a premium market segment where LDES can compete on value rather than simply on levelized cost per kWh.

Industrial Heat and Process Electrification Unlocking a Massive Thermal LDES Market

Another major opportunity lies in industrial heat decarbonization, where long-duration thermal storage can decouple cheap, variable renewables from continuous process heat needs in sectors like steel, cement, chemicals and food processing. High-temperature solutions such as Rondo’s “brick” heat batteries and Antora’s carbon-block thermal batteries store electricity as heat at hundreds to over a thousand degrees Celsius, then deliver either direct process heat or power via thermophotovoltaic converters, enabling plants to run on round-the-clock renewable energy without expensive gas backup. This creates new value pools for LDES beyond the power market, as industrial firms seek to meet net-zero commitments and hedge against fossil fuel price volatility. Policy support, like EU industrial decarbonization funds or U.S. industrial demonstration programs, can co-fund early projects, and once these systems are mature, they can be replicated across similar facilities globally. For LDES vendors, this diversifies revenue away from purely utility-scale tenders and opens partnership opportunities with industrial OEMs, EPCs and process licensors.

Competitive Landscape

The major players operating in the long-duration energy storage (LDES) market are ACWA Power, Ambri, BYD Co. Ltd, Contemporary Amperex Technology Co., Limited, Engie SA, ESS Inc., Everllence, Fluence Energy, MGA Thermal Pty Ltd, Sumitomo Corporation, TAQA, Tesla Energy Operations, Inc, The AES Corporation, Toshiba Energy Systems & Solutions Corporation, VFlowTech Pte Ltd. 

Recent Developments

• 09-Dec-25, ACWA Power and Bapco Energies sign a Joint Development Agreement to build a 2.8 GW solar power plant with large-scale battery energy storage in Saudi Arabia’s Eastern Province. All electricity will be transmitted to Bahrain, supporting national energy needs and accelerating renewable integration. Agreement announced during the Saudi–Bahraini Coordination Council meeting.
• 04-Dec-25, MGA Thermal secured strategic investment from Electrifi Ventures in partnership with Climate Salad. The investment complements a recent AU$2.5 million funding boost from the Australian Renewable Energy Agency, strengthening MGA Thermal’s growth outlook amid rising industrial demand for long-duration thermal storage solutions.
• 11-Nov-25, CATL entered a decade-long comprehensive partnership with Guangzhou Automobile Group Co., Ltd. covering battery supply, joint R&D, and energy ecosystem co-creation. The agreement aims to build the technological foundation for next-generation intelligent electric vehicles and long-term industry collaboration.
• 04-Nov-25, Everllence partnered with Vicinity Energy to install the world’s largest steam heat pump (35 MW thermal output) at Kendall Station, Cambridge. The project will deliver climate-neutral steam via Boston’s district heating network using renewable electricity and river-sourced thermal energy.
• 30-Oct-25, ACWA Power signs USD 10 billion worth of agreements at the Future Investment Initiative (FII9). Includes renewable energy, energy storage, financing partnerships, and R&D collaborations across GCC, China, Central Asia, and Africa. A major USD 6B portfolio involves NREP projects with Badeel and Saudi Aramco, backed by major global banks.

About Visiongain

Established in 1998, Visiongain is an independent publisher of analyst-led market intelligence, delivering data-driven research, forecasts, and strategic insight across global industries and emerging markets. Visiongain supports evidence-based decision-making for investment, procurement, and long-term strategic planning.

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