Business Segments – HUASAI

Business Segments

Compressed Air Energy Storage

Compressed Air Energy Storage

As the share of renewable energy such as wind and solar exceeds 50%, their intermittency and variability pose significant challenges to power balance, requiring long-duration energy storage for cross-time-scale regulation.
At the same time, renewable energy systems relying on converter-based grid connection lead to a lack of rotational inertia, posing significant challenges to system stability and security.
CAES leverages physical rotational characteristics and offers multiple advantages, including large capacity, long-duration regulation, strong grid-forming capability, low lifecycle cost, long lifespan, flexible siting, and multi-energy coupling.
It not only enables large-scale peak shaving and load shifting but also provides inherent inertia support to the grid, making it an essential technology for next-generation power systems.

Working Principle of CAES

CAES is a form of energy storage where electricity is used during off-peak periods to compress air, which is then released during peak periods to drive turbines for power generation.
The system consists of four main processes:
● Compression
● Air storage
● Heat exchange
● Expansion

Energy Storage

During charging, electricity drives compressors to generate high-pressure air and compression heat, which are stored separately.

Energy Release

During discharge, high-pressure air and stored heat are combined to drive turbines for power generation. Excess heat can be used for heating, and cold air produced during expansion can be used for cooling, enabling combined cooling, heating, and power (CCHP).

Comparison of Energy Storage Technologies

Technical Specifications	Compressed Air Energy Storage (CAES)	Pumped Hydro Storage (PHS)	Lithium-ion Battery	Flow Battery
Power Scale	MW-GW	GW	kW-MW	kW-MW
Discharge Duration	2-10h	6-12h	1-2h	4-6h
Stability Characteristics	AC Storage: Features standby, phase modulation, and black start capabilities; Provides rotational inertia	AC Storage: Features standby, phase modulation, and black start capabilities; Provides rotational inertia	DC Storage	DC Storage
System Efficiency	~70%	~75%	~80%	~70%
Safety Performance	High	High	Low	Medium
Construction Period	12-24 Months	72-96 Months	3-6 Months	6-9 Months
Service Life	40-50 Years	40-50 Years	5-10 Years	15-20 Years
Unit Cost (RMB/Wh)	1.0-1.8	1.2-2.0	0.7-1.0	2.0-2.5
LCOS (RMB/kWh)	0.16-0.30	0.20-0.33	0.24-0.31	0.43-0.54

Note: Levelized cost of electricity (LCOS) is calculated over a 30-year lifecycle.
Battery replacement costs are included.
LCOS = (total capital cost + total operational cost) / total discharged electricity.
Charging electricity cost is assumed to be zero.
All costs are calculated based on generation-side capacity.

Comparative Advantages	CAES vs Pumped Hydro	CAES vs Lithium-ion and Flow Battery storage systems
Construction & Deployment	Offers high flexibility in site selection and significantly shorter construction periods	Features massive energy storage capacity and a long operational service life
Technical Performance	Highly adaptable regulation capabilities with strong combined heat and power (CHP) coupling effects	Ensures grid stability and high operational safety with zero-carbon and environmentally friendly processes
Economic Efficiency	Construction costs are comparable to traditional large-scale storage, while maintenance costs remain low with significant cost-reduction potential	The annualized average cost is substantially lower than that of Lithium-ion and Flow Battery storage systems

Advantages of CAES

Large Capacity

One of the largest-scale physical energy storage technologies, with single plants reaching GW-scale and storage durations of 2–10 hours

High Safety

No combustion, no chemical reactions, and no harmful emissions

Strong Grid-Forming Capability

Provides synchronous generator-level performance, including inertia support, black start capability, fast response, and active/reactive power regulation

Low Cost

Comparable LCOE to pumped hydro, with over 40 years of lifespan significantly reducing lifecycle costs

Flexible Deployment

Multiple storage options without strict geographical constraints, with construction periods as short as 12–24 months

Long Lifetime

Designed lifespan of 40–50 years, minimizing reinvestment and resource waste

End-to-end Solution

With the capacity to develop and construct custom GW-scale power plants, we provide DTEPCO full-process services—including Project Development, Technical Process, Engineering Design, Equipment Development, Project Construction, and Operational Optimization—centered on our core expertise in CAES system process design.

Project development & commercial planning System process design & dynamic simulation Core equipment development & parameter definition EPC delivery (design, procurement, construction) Intelligent O & M & asset optimization

Project development & commercial planning We provide customized development solutions for projects ranging from the megawatt to gigawatt scale, covering everything from site selection and investment evaluation to grid connection design.

System process design & dynamic simulation By leveraging our proprietary digital platform to perform dynamic simulations of multi-energy-flow systems under all operating conditions, we achieve precise design and technological leadership in pressure storage system processes.

Core equipment development & parameter definition We possess in-depth expertise in the engineering design of three core pieces of equipment—compressors, heat exchangers, and turbines—and ensure control over key parameters and system integration from the very outset of the technical process.

EPC delivery (design, procurement, construction) We provide end-to-end EPC services covering everything from design and procurement to commissioning, ensuring high-quality and safe project delivery.

Intelligent O & M & asset optimization Use digital twin models for condition assessment and predictive maintenance, and enhance the overall returns from power plant participation in electricity market transactions through intelligent control.

Multi-Scenario Applications

Generation Side

Smooth renewable output, support peak regulation and frequency control

Grid Side

Provide inertia and reactive power support to enhance grid stability

End-User Side

Reduce energy costs and improve reliability for industrial users

Featured Projects

Jiangsu Salt Cavern CAES National Demonstration Power Station Project The world's first commercially operating non-supplementary CAES power station

Capacity 60MW/300MWh

Inner Mongolia Huade CAES and Key Equipment R&D and Application Demonstration Project The world's first alpine, wide-sliding-pressure CAES power station

Capacity 60MW/240MWh

Inner Mongolia Sonid Left Banner Compressed Air Energy Storage Demonstration Project It was included in Inner Mongolia's first batch of new energy storage demonstration projects

Capacity 100MW/400MWh

Inner Mongolia Ulanqab Zhuozi County Compressed Air Energy Storage Demonstration Project The world's largest compressed air energy storage project

Capacity 1050MW/6300MWh