Lifetime Cost Analysis of Compressed Air Energy Storage Technology in China

Compressed air energy storage (CAES) technology has significant advantages such as large storage capacity, high efficiency, long lifetime, easy maintenance, and short construction period, demonstrating great potential in the field of large-scale and long-duration energy storage applications. This paper analyzed the lifetime costs of CAES systems using salt caverns and artificial caverns for air storage, and explores the impact of discharge duration, electricity purchasing price, and capital cost on the levelized cost of storage (LCOS). The following conclusions were drawn: as the discharge duration increases, the LCOS of CAES systems experience a sharp decrease followed by an increase. Among them, the LCOS of CAES systems using artificial caverns shows a more pronounced upward trend with the extension of discharge duration, while CAES systems utilizing salt caverns exhibit better economics for long-duration energy storage applications. The electricity purchasing price has a significant impact on the LCOS of CAES systems, and utilizing cheap surplus wind and solar power can effectively enhance the economics of CAES. As CAES technology scales up, equipment and construction expenses are expected to decrease further, leading to a potential 10%~30% reduction in LCOS.