LDES is the foundation of a resilient, independent energy future

Willow Rock Energy Storage Center from above

Smart policies can get us there faster

The unpredictable start to 2025 hasn’t changed our North Star here at Hydrostor. We remain clear-eyed and bullish about the very real and shovel-ready promise of Long Duration Energy Storage (LDES), especially the benefits it can deliver to communities and businesses in the very near future. Regardless of what side of the aisle you sit on, every community and business wants and needs grid reliability, affordability, and resilience. That’s why Scott Bolton, our Executive Vice President of Global Policy and Regulatory Affairs, sat down recently with Heatmap’s Mike Munsell on the Shift Key podcast to discuss the current LDES landscape. Listen to the three installments of their conversation here, here, and here, and read on for our high-level takeaways.

1. The time for LDES is now

LDES is important—right now—for a few simple reasons. First, global energy demand continues to rise at an incredible pace. From the much needed electrification of transportation to the rise of hyperscale data centers, this rapid load growth isn’t slowing anytime soon. Second, as utilities continue to absorb the lowest cost power source—increasingly delivered by wind and solar—the need for utility-scale storage increases. This is the LDES tipping point, a threshold we are now approaching, when the percentage of variable energy resources on the grid triggers the need for large scale storage infrastructure beyond 8 hours of duration. To achieve this reliability, we need proven and durable LDES technologies with characteristics that can solve varying grid challenges. Leading LDES options, such as Hydrostor’s Advanced Compressed Air Energy Storage (A-CAES) technology, offer distinct characteristics that go beyond smoothing out the dreaded duck curve Hydrostor’s energy storage facilities are relatively compact, capable of deploying a 500 MW (4 GWH) facility on less than 100 acres (roughly 85 percent less land than equivalent sized pumped hydro power). Because of this, they can be strategically located to reduce transmission bottlenecks, while still providing the valuable ancillary benefits associated with mechanical storage, including the inertia needed for predictable, high-quality power service.

2. Federal policy remains a critical lever for scaling LDES deployment

The US Department of Energy’s conditional loan guarantee for Hydrostor’s Willow Rock project, totaling $1.76 billion, advances the financing of a major LDES project in California—one that will make an enduring contribution to the local economy throughout the 50+ year project lifetime. It also creates a market signal about the maturity of this LDES technology. The technical and economic due diligence (which typically spans 1-2 years) that is required for federal loans positions them as a significant vote of confidence for the recipient technology.

Aligned bipartisan policy at the federal level that continues to embrace tech neutrality is critical to ensure the continued growth of LDES investment and deployment across the country. First, federal policy has the opportunity to champion the goals of energy independence and grid reliability based on a domestic supply chain that uses incentives to create an investment climate for LDES and other technological innovations. Second, federal policy has the opportunity to reduce barriers to entry, including permit reform. At its best, federal policy can both signal and institutionalize stability and feasibility for investors while helping create high-paying domestic jobs.

3. Earlier state policy wins are paving the way for LDES

The vast majority of energy policy and planning takes shape at the state level. State legislators and regulators determine energy system development in their jurisdictions, impacting how power is delivered and at what price. States can also create financial incentives that lower economic barriers to investment, complementary to federal policy. While New York and California remain leaders of energy storage policy and currently have the most advanced energy storage markets, states like Maryland, Virginia, Arizona, and Nevada are rapidly championing energy storage investment and deployment.

The state policy levers for LDES and other technological innovation also benefit from the earlier policy wins and roadmap used for solar, wind, and renewable portfolio standards fifteen to twenty years ago. Whether it’s solar and wind or LDES, policy target setting at the state level signals to investors and the marketplace that there’s both a need and support mechanism, thereby reducing risk and attracting capital. Another win? LDES investment will only strengthen existing renewable portfolio standards, helping them work better for everyone by further integrating existing renewable energy sources.

The LDES Policy Horizon

Federal and state policy played a key role in establishing the current energy infrastructure landscape, helping companies navigate from pilot project to commercialization at scale. Now energy storage is at home plate, and the umpire needs to have the required policy arsenal. While it is not a silver bullet, the win-win nature of LDES cannot be overstated. Whether it’s consumer affordability, resource adequacy, solving gaps in energy markets, flexible deployment, or infrastructure security during natural disasters, energy storage investment benefits everyone. Although changes like permitting reform are needed to further catalyze LDES investment and grid resilience, economic and policy tailwinds continue to transform the good idea of energy storage into a reality, unlocking opportunity for everyone.