China has inaugurated the largest compressed-air energy storage facility in the world.

The world's largest compressed-air energy storage facility, boasting a capacity of 2.4 GWh, has begun operations in Jiangsu province, China. This plant stores energy in underground salt caverns and does not utilize any fuel for combustion.

The compressed-air energy storage (CAES) facility features two 300 MW energy storage units that do not burn fuel. It works by compressing air and storing it in underground salt caverns during times of low electricity demand. When demand peaks, the stored air is released to power air turbines, generating electricity.

For heat management, the CAES system incorporates molten salt and pressurized thermal water storage. According to Harbin Electric Corporation, which provided the equipment for the Guoxin Suyan Huai’an Salt Cavern Compressed Air Energy Storage Demonstration Project, this system achieves a conversion efficiency of 71%.

Reports indicate that the first 300 MW unit began full-load operation in December 2025, while the second unit was activated earlier this week. The total investment for the project is approximately USD 520 million, and it is anticipated to produce 792 GWh of electricity each year.

China aims to invest USD 35 billion to enhance its energy storage capacity by 2027. This project has expanded China’s long-duration energy storage capabilities, aligning with its goal to increase total energy storage capacity, excluding pumped hydropower, from over 100 GW in 2025 to over 180 GW by 2027. This target was revealed in an action plan announced in September 2025 and is expected to attract more than USD 35 billion in investment over three years.

Battery energy storage is crucial to China's strategy for green transition, alongside solar power and electric vehicles.