Cost Analysis for Large Thermal Energy Storage Systems

Abstract

Thermal energy storage (TES) technologies play a key role in decarbonizing heat supply and integrating renewable energy sources into heating systems. This study analyses the investment costs of over 50 large TES systems - aquifer (ATES), borehole (BTES), pit (PTES) and tank (TTES) - based on desk and literature research. The cost model developed incorporates inflation and purchasing power parities to ensure comparability across regions and time periods and derives cost functions for investment appraisal. The results highlight significant differences in the cost structures and scalability of TES technologies. PTES systems benefit from strong economies of scale, making them cost-effective for large storage volumes. TTES systems are more suitable for smaller applications due to higher specific costs. ATES and BTES systems show moderate economies of scale but remain highly dependent on geological conditions and drilling costs. The study also introduces a new framework for calculating the Levelized Cost of Storage (LCOS), which renders the different technologies comparable as the costs to provide energy at the target temperature level are considered. This approach provides a more accurate assessment of the competitiveness of TES. The results provide decision-makers with a transparent basis for evaluating TES investments, thereby reducing uncertainty. Additionally, the study calls for further research to validate cost models and assess TES impacts in practice.