Thermal Batteries Market Outlook 2026–2038: Market Size, Growth Drivers, Key Players, Strategic Developments & Adoption Forecast for Heat Batteries, Thermal Storage for Process Heat, Industrial Heat Pumps and Heat-as-a-Service — A Meticulous Next™ Foresight Brief

This Meticulous Next™ brief examines how thermal batteries, from brick and block heat stores to molten silicon and sand systems, together with industrial heat pumps and heat-as-a-service contracts, replace fossil boilers and furnaces as the source of industrial process heat over the next twelve years. The change runs from the wind farm to the factory boiler house, and the first links are now operating.

The case begins with the size of the problem. About one-fifth of global energy consumption goes to industrial heat, and 89% of that heat is generated by burning fossil fuels. Cement alone accounts for about 8% of global CO2 emissions, and roughly 60% of that comes from the chemical reactions in the raw materials rather than from fuel. Heat is therefore the largest and least electrified use of energy in industry, and any technology that can deliver it from electricity at a competitive price opens a very large market.

That technology has now been demonstrated at industrial sites. A 33 MWh heat battery from Rondo Energy began operating at a cement plant in Thailand in November 2025. Covestro broke ground on a 100 MWh Rondo heat battery at Brunsbüttel in January 2026, designed to supply 10% of the steam of the site and to save up to 13,000 tonnes of CO2 a year. Electrified Thermal Solutions commissioned a 20 MWh unit in San Antonio in January 2026 that stores heat at up to 1,800°C. Delivery at this scale shows that the question has moved from whether the technology works to how quickly it can be built.

Capital and customers followed the demonstrations. Antora Energy raised a USD 550 million Series C in July 2026, bringing corporate and project financing to about USD 1 billion, after starting up a system of more than 200 modules at the Poet biofuels plant in South Dakota. In September 2026 Holcim announced two heat batteries from Electrified Thermal Solutions for a high-temperature chamber inside one of its plants, the third industrial partnership of the company. Repeat orders from cement, chemical, steel and biofuel producers are the signal that heat batteries are becoming a procurement category.

Policy and electricity pricing set the pace. The EU requires an indicative annual rise of 1.6 percentage points in the renewable share of industrial energy use, and the carbon border adjustment mechanism entered its definitive period on 1 January 2026 for cement, steel and aluminium. In the United States, the investment credit for energy storage remains in place under the 2025 reconciliation law, and utilities such as Otter Tail Power are designing tariffs that reward charging when local renewable output is in surplus. Where carbon has a price and surplus power is cheap, storing electricity as heat beats burning gas.

The brief maps the technology, its indicative market size and forecast, the factors behind its growth, the developments of the last 24 months, the key players operating in the space and the adoption trajectory to 2038.

It is a focused 112-page decision brief for industrial energy users, heat battery and heat pump suppliers, utilities and grid operators, project developers, lenders and investors, and policy makers. It presents an indicative trajectory rather than a segmented market model. Its purpose is to identify which temperature bands and industries adopt first, how electricity price and carbon rules sequence demand, and who captures value as industrial heat becomes a flexible electric load.

A thermal battery stores electricity as heat and gives it back as steam, hot air or process heat on demand. The storage medium is cheap and durable: heated bricks, graphite or silicon blocks, sand, salt or crushed rock. It is charged when electricity is abundant and low priced, and it discharges steadily to the factory whatever the grid is doing. Each design trades storage temperature, round-trip efficiency and cost, which decides the industries it can serve.

Temperature is the dividing line. Industrial heat pumps serve low and medium heat up to about 150°C, which covers much of food, beverage, paper and chemical processing. Brick and block batteries from Rondo Energy and Kraftblock supply steam and hot air in the middle band. Systems from Electrified Thermal Solutions store heat at up to 1,800°C and deliver hot gas at up to 1,500°C, enough for calcination, which typically needs 900°C to 1,500°C. The higher the temperature a technology reaches, the more of the fossil heat market it can address, and the fewer rivals it has.

The economics rest on the price of electricity at the hour of charging. A heat battery turns an intermittent supply into a steady load, so it can buy power when wind and solar are in surplus and avoid the peaks. The Otter Tail Power tariff in the United States is built on exactly this logic, rewarding charging at times of surplus local renewable output. Where that spread exists, the cost of heat from storage falls below the cost of heat from gas. Where it does not, the battery needs a carbon price or a subsidy to compete.

Delivery models matter as much as hardware. Industrial users are cautious about owning new heat equipment, so suppliers increasingly sell heat itself, with a contract per tonne of steam or per megawatt hour, and carry the capital and performance risk. Heat-as-a-service from developers such as Skyven Technologies and Engie follows the pattern that solar power purchase agreements set earlier. It lowers the barrier for the first project and builds a financeable asset class for the hundredth.

The constraints are cost, scale and grid access. First-of-a-kind units still carry high installed costs, supply chains for blocks, bricks and power electronics are young, and a 100 MWh battery needs a strong grid connection that many industrial sites lack. Pricing of capital and of electricity vary widely between regions. The decade turns on whether manufacturing scale, repeat orders and tariff design bring delivered heat below the gas price in enough places before gas and carbon prices move against the technology.

The thermal batteries market, covering heat batteries and thermal storage systems for industrial process heat, together with installation, integration and heat-as-a-service contracts, and excluding concentrated solar power storage, building heating storage, domestic hot water storage and standalone heat pumps without storage, is valued at USD 0.4–0.6 billion in 2026 and is projected to reach USD 12–16 billion by 2038, at a CAGR of 31–33%.

The 2026 base rests on first commercial deployments in cement, chemicals and biofuels, including the Rondo unit in Thailand, the Antora system at Poet and the Covestro installation under construction, together with demonstration units from Electrified Thermal Solutions and sand and block systems in Europe. From that base, growth follows the order book. Holcim units due in early 2027, an ArcelorMittal test in Spain and the pipeline of Antora with data centre, biofuel, chemical and food customers set the pace to 2028, after which factory output and repeat orders drive unit costs down.

The forecast is sensitive to electricity prices at the hour of charging, to the carbon price in Europe and to continuation of storage incentives in the United States. Regionally, North America leads on large first projects and venture capital, Europe on policy pull and industrial customers, China and Southeast Asia on cement and manufacturing volume, and Japan, India and Australia on emerging pilots.

The base case assumes steady electricity price spreads, carbon border adjustment applied as legislated, storage incentives retained in the United States and unit costs falling with factory output, giving the inflection around 2032. An accelerated case adds higher gas and carbon prices, faster grid connections and large utility partnerships, bringing the inflection to 2030 and lifting the 2038 value to the top of the range. A delayed case assumes slower grid access, weaker carbon pricing and reduced incentives, holding growth at the bottom of the range.

Growth drivers

• Scale of the fossil heat market: about one-fifth of global energy use goes to industrial heat and 89% of it is fossil fired.
• Carbon rules: EU renewable share target of 1.6 points a year for industry, carbon border mechanism definitive from January 2026, expansion of the China national carbon market to steel, cement and aluminium.
• Proven delivery: 33 MWh in Thailand, 20 MWh at 1,800°C, 100 MWh under construction at Covestro, 200+ module system at Poet.
• Customer repeat orders: Holcim second project, ArcelorMittal test, Antora pipeline with data centre, chemical and food customers.

Enablers

• Abundant renewable electricity at low prices and tariff designs such as the Otter Tail Power structure.
• Capital: USD 550 million Series C for Antora and about USD 1 billion of corporate and project financing.
• Heat-as-a-service contracts that move capital and performance risk to suppliers.
• Public finance and philanthropic support, including European Investment Bank and Breakthrough Energy Catalyst backing for Brunsbüttel.

Restraints and barriers

• High installed cost of first-of-a-kind units and young supply chains for blocks, bricks and power electronics.
• Grid access: large batteries need strong connections that many industrial sites lack.
• Electricity and gas price differences by region, which decide whether delivered heat is competitive without subsidy.
• Policy risk: changes to storage incentives in the United States and delays in European carbon border enforcement.

Five converging forces will determine how fast thermal batteries scale in industry.

(1) Electricity price spreads and tariff design. (2) Carbon pricing and border rules. (3) Manufacturing scale and installed cost. (4) Grid connection and site integration. (5) Heat-as-a-service financing and customer repeat orders. The brief assesses each force for direction, speed and confidence.

The key players operating in thermal batteries include Rondo Energy, Inc., Antora Energy, Inc., Electrified Thermal Solutions, Inc., Fourth Power, Inc., Kyoto Group AS, Polar Night Energy Oy, Kraftblock GmbH, Brenmiller Energy Ltd., EnergyNest AS, MGA Thermal Pty Ltd, Lumenion GmbH, Sunamp Limited, Siemens Energy AG, Johnson Controls International plc, Mitsubishi Heavy Industries, Ltd., Kobe Steel, Ltd., Mayekawa Mfg. Co., Ltd., Star Refrigeration Limited, AtmosZero, Inc., Skyven Technologies, Inc., Engie SA, Veolia Environnement SA, Holcim Ltd, Covestro AG, ArcelorMittal SA, Vale S.A., Poet, LLC, BASF SE, Otter Tail Power Company, E.ON SE, Vattenfall AB, Breakthrough Energy Catalyst, the European Investment Bank, G2 Venture Partners, Eclipse Ventures, the US Department of Energy, the European Commission, the International Energy Agency, the International Renewable Energy Agency, Southwest Research Institute, Fraunhofer-Gesellschaft, the German Aerospace Center (DLR) and the Massachusetts Institute of Technology.

The brief profiles representative players in each archetype and assesses which are positioned to make electrified heat the default for industry.

The competitive landscape is forming around six archetypes. Thermal battery developers. Heat pump and conventional equipment groups. Heat-as-a-service providers. Industrial heat users. Utilities and grid operators. Financiers, public bodies and research institutions. Competitive intensity is moderate in 2026 and is expected to rise as factory scale and repeat orders attract large equipment groups through 2032.

Where value migrates.

In 2026 value sits in first-of-a-kind projects, venture and project finance, and demonstration hardware. By 2032 it moves to factory-built units, installation and integration, and financed heat-as-a-service portfolios. By 2038 it settles in manufacturers with scale, developers with long-term heat contracts and utilities with flexible tariffs. One-off engineered projects and unbacked pilots lose standing.

The signals converge on delivery. Operating units are in place, with 33 MWh in Thailand, 20 MWh at 1,800°C and a system of more than 200 modules at a biofuels plant. Large units are under construction, with 100 MWh at Covestro due at the end of 2026. Customers are repeating, with Holcim ordering two units as its third partnership of this type and ArcelorMittal testing a battery in Spain. Capital is arriving, with USD 550 million for Antora in a single round. Each signal moves heat batteries from demonstration toward routine procurement.

Research and patent activity reflects where the chain is weakest: cost of storage media, power electronics at high temperature, steam generation from stored heat and controls for grid-responsive charging. The brief therefore tracks four indicators: installed thermal storage capacity at industrial sites, the delivered cost of heat from storage against gas, the number of repeat orders by single customers and the share of tenders that include heat batteries.

Regionally, North America leads on large first projects and venture capital, Europe on policy pull and industrial customers, China and Southeast Asia on cement and manufacturing volume, and Japan, India and Australia on emerging pilots. Cement, chemicals, biofuels, steel and food and beverage producers in regions with cheap renewable power are the first demand pools.