Flywheel UPS Market

Market Overview

The global flywheel UPS market size was valued at USD 366.0 million in 2023 and is projected to reach a value of USD 613.2 million by 2032, registering a CAGR of 5.9% during the forecast period (2024-2032). Voltage change protection, fast recharge, high reliability, high energy scalability, and low maintenance drive the flywheel UPS market share.

A Flywheel Uninterruptible Power Supply (UPS) is an energy storage system that provides short-term backup power during power outages. Unlike traditional UPS systems that rely on batteries, flywheel UPS systems store energy kinetically in a spinning mass (flywheel) and convert it back to electrical power as needed.

Increased implementation of flywheel UPS systems in the transportation and aerospace industries due to energy storage systems is expected to drive market growth. The increase in automotive manufacturing is expected to strengthen the automotive sector in developed and developing countries, expanding the flywheel UPS market. The global flywheel UPS market is driven by increased demand for energy-storage devices and reliable power supply, particularly in business workstations.

In addition, the market is expected to expand due to increased demand for energy backup, particularly from the business sector. The demand for UPS systems is growing as the industrial and commercial sectors rely more on digital equipment and automation technologies. This factor drives flywheel UPS market growth.

Market Dynamics

Global Flywheel UPS Market Drivers:

Rising Adoption in the Aerospace and Transportation Industry

Rising flywheel UPS adoption in the transportation and aerospace industries is expected to propel market growth. Increasing automotive demand in developed and developing countries is expected to strengthen the automotive sector, boosting the Flywheel UPS market. The global flywheel UPS market is expected to increase demand for energy storage devices and continuous power supply, particularly in commercial workstations. The aerospace industry uses advanced technologies and data centers for various purposes, including aircraft design, simulation, and testing. These facilities require continuous and uninterrupted power to ensure the dependability of critical processes. Flywheel UPS systems, known for their fast response times and low maintenance requirements, are ideal for providing continuous power backup to data centers in aerospace facilities. Major airports worldwide increasingly turn to flywheel UPS solutions to protect critical systems. The Norman Y. Mineta San José International Airport in California utilizes Pentadyne Power's advanced composite flywheel technology with an uninterruptible power supply (UPS) system.

Similarly, the transportation industry, particularly railways, depends heavily on advanced signaling systems to ensure safe and efficient operations. These systems require a consistent and reliable power source. Flywheel UPS systems can be installed at railway signaling stations to provide rapid power backup, ensuring that signaling equipment operates continuously even during brief power outages. The CN107492902B is a 2023 railway traction power supply system incorporating a flywheel energy storage device. It can improve the power quality of railways. The growing use of flywheel UPS in the aerospace and transportation industries is motivated by the need for immediate and dependable power backup solutions. As critical operations in these industries rely more on advanced technologies, flywheel UPS systems provide a strategic advantage by ensuring continuous and uninterrupted power, improving safety, efficiency, and reliability.

Global Flywheel UPS Market Restraints:

High Initial Cost

One of the primary disadvantages of flywheel UPS systems is their higher initial cost compared to traditional battery-based UPS systems. The initial investment required to implement flywheel technology can be significant for organizations, particularly those operating on a tight budget. According to Greenverse Partners, installing a flywheel ranges from USD 1,500 to USD 6,000 per kWh. According to market research and cost analyses in the power protection industry, the upfront cost per kilowatt (kW) power capacity for flywheel UPS systems ranges from USD 800 to USD 1,200, depending on system specifications and manufacturer. Traditional battery-based UPS systems, on the other hand, can cost anywhere between USD 600 and USD 1,000 per kW up front.

Furthermore, the higher initial cost of flywheel UPS systems can be a significant consideration for organizations with limited budgets, particularly when multiple units are required for redundancy and scalability. Flywheel UPS systems last longer, have a smaller footprint, and are more reliable than batteries. Over the product's lifetime, the cost savings can be up to twice as much as the initial investment. Flywheel UPS manufacturers have traditionally kept their software and technology proprietary, limiting competition for system maintenance. This raises ongoing maintenance costs because the end user often relies on the manufacturer for critical equipment service. 

Global Flywheel UPS Market Opportunity:

Integration with Renewable Energy Sources

Integrating flywheel UPS systems with renewable energy sources represents a compelling opportunity, in line with the global push for sustainable and green energy solutions. Flywheel technology's ability to efficiently store and release energy makes it an essential component in renewable energy systems, contributing to grid stability and increasing the overall reliability of power generation from sources such as solar and wind. Microgrids powered by renewable energy are gaining popularity in remote or off-grid areas with limited access to a stable power grid. Flywheel UPS systems are used in these scenarios to deal with the intermittent nature of renewable energy generation. The IEA predicts that global electricity demand will increase by 3% annually between 2023 and 2025, compared to the 2022 growth rate. 

Furthermore, the IEA predicts that renewables will account for 35% of global power generation by 2025, up from 29% today. The report indicates that China, Southeast Asia, and India will account for more than 70% of this. However, advanced economies aim to generate more electricity while reducing reliance on fossil fuels in sectors such as heating and transportation. As a result, a microgrid powered by solar panels may experience variations in energy output due to weather conditions. Flywheel systems seamlessly bridge power supply gaps, ensuring consistent and reliable energy delivery to critical loads. Furthermore, flywheel systems outperform traditional battery-based energy storage in renewable applications. They have higher efficiency, a longer lifespan with minimal degradation over time, and a lower environmental impact because they do not use hazardous materials in specific battery chemistries.

Regional Analysis

North America Dominates the Global Market

The global flywheel UPS market analysis is conducted in North America, Europe, Asia-Pacific, the Middle East and Africa, and Latin America.

North America is the most significant global flywheel UPS market shareholder and is estimated to grow at a CAGR of 6.3% over the forecast period. The flywheel UPS market is expected to be dominated by North America, primarily because of significant industries and IT companies and the need for uninterrupted power supply to data centers and businesses. Additionally, the region's market experiences growth due to rapid economic development, improved standards of living, and increased demand for a consistent electricity supply. The US Energy Information Administration (EIA) predicts a US power demand decline from 4,048 billion kilowatt-hours (kWh) in 2022 to 3,984 billion kWh in 2023. According to the EIA, the electricity demand is projected to increase to 4,068 billion kWh by 2024 due to the expected economic growth.

Asia-Pacific is anticipated to exhibit a CAGR of 6.9% over the forecast period. The Asia-Pacific region is projected to experience higher compound annual growth rates (CAGRs) in the forecast period, driven by growing demand in automotive, aircraft, food processing, telecommunications, and electricity supplies. The rise in per capita disposable income in developing nations like China, India, Japan, and South Korea, frequent power outages, and growing energy demands drive the demand for flywheel energy storage systems. This is contributing to the growth of the market in the region.

Additionally, Dinglun Energy Technology (Shanxi) Co., Ltd. began building a 30 MW flywheel energy storage project in Tunliu District, Changzhi City, Shanxi Province on June 7th, 2023. This project is China's inaugural grid-level flywheel energy storage frequency regulation power station and is a significant undertaking in Shanxi Province. It is a crucial regional project as one of the initial pilot demonstration projects for integrating "new energy + energy storage." The station comprises 12 flywheel energy storage arrays, each with 120 flywheel energy storage units. These arrays will be interconnected with the Shanxi power grid. This will additionally propel the market in a forward direction.

Europe is projected to experience growth in the UPS flywheel market due to the strong demand for automobiles. The expansion of the automotive industry is expected to influence the development of the UPS flywheel market in the forecast period. For instance, EU car sales have experienced a significant growth of nearly 17% in 2023 and are projected to increase by 2.5% in 2024. By 2023, the market share of battery-electric cars has surged to 14.6%. European electric vehicle (EV) sales, encompassing both battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs), are projected to grow by 15% in 2023 compared to the previous year, 2022. Electric vehicle sales in Europe have experienced a 37% growth rate in 2023. 

In addition, European nations have been enacting policies and regulations to promote the adoption of energy storage technologies, such as flywheels. Implementing initiatives such as the European Green Deal and national targets for renewable energy has established a beneficial regulatory framework for utilizing flywheel energy storage systems. Flywheels offer grid operators rapid response times and excellent cycling capabilities, making them highly suitable for grid flexibility and stability services.

Latin America is expected to experience economic expansion throughout the projected timeframe. The area is undergoing a significant and abrupt shift in energy sources and systems. Several nations are swiftly shifting from conventional energy sources like hydroelectric power and crude oil to a diverse energy portfolio encompassing a range of cleaner fuels. This challenges the region to fulfill the electricity requirements throughout Latin America. Countries such as Brazil, Jamaica, Argentina, Chile, and others are progressively allocating resources to bolster and expand their energy storage infrastructure.

In the Middle East and Africa region, growth is anticipated throughout the forecast period. The demand for energy storage systems is rapidly increasing due to the growing need for uninterrupted electricity among the population. Datacenter installations are experiencing a rise in the GCC region. Saudi Arabia has 22 data centers, while the UAE has 9. Data centers often choose to implement flywheel energy storage systems because of their advantages, superior efficiency and reliability, convenient maintenance, and increased storage capacity.

Segmental Analysis

The global flywheel UPS market is segmented based on application and industry

The market is further segmented by application into data centers, Medical Imaging, and Industrial Critical Processes.

Industrial Critical Process accounts for the largest share of the market.

Industrial Critical Process

Industrial critical processes include a wide range of manufacturing and production activities where power outages can result in operational inefficiencies, safety risks, or product quality issues. Flywheel UPS systems are used in this segment to protect critical machinery and processes. Flywheel technology provides stability to manufacturing, chemical processing, and semiconductor production industries. The ability of flywheels to respond instantly to power disturbances ensures that industrial processes run uninterrupted, reducing downtime and preserving the integrity of complex manufacturing operations. As industries prioritize resilience and efficiency, flywheel UPS systems are increasingly important in ensuring critical processes continue.

Datacenters

Datacenters are central hubs that house computing and networking equipment, forming the foundation of modern digital infrastructure. In this application segment, flywheel UPS systems are critical for ensuring continuous power to data center operations. Flywheel systems' instantaneous response and short-term energy storage capabilities make them ideal for bridging the gap during power outages, avoiding data loss and downtime. As data centers prioritize energy efficiency and rapid power backup solutions, flywheel UPS systems offer a dependable and environmentally friendly alternative to traditional battery-based systems.

The industry can further bifurcate the market into Healthcare, Oil and Gas, Defense, and Automotive.

Automotive influenced the market growth.

Automotive

The automotive industry, which heavily relies on precision machinery and employs advanced manufacturing processes, experiences advantages by implementing flywheel UPS systems. Uninterrupted power is essential in automotive manufacturing plants to ensure the smooth operation of robotic assembly lines, quality control systems, and overall production efficiency. Flywheel UPS systems play a crucial role in reducing downtime and preventing interruptions in the manufacturing process, guaranteeing that automotive facilities maintain uninterrupted operations. With the automotive industry adopting automation and intelligent manufacturing technologies, flywheel technology's dependability and quick response features are becoming more valuable in ensuring smooth operations.

Defense

Flywheel UPS systems are used in defense applications to safeguard sensitive electronics and communication infrastructure, mainly when unwavering reliability is crucial for mission-critical systems. Flywheel technology is utilized by military installations, command centers, and defense facilities to guarantee the continuous operation of essential equipment, communication networks, and surveillance systems, even in the presence of power disruptions. The flywheel UPS systems can promptly supply backup power to the strict demands of defense applications. These applications necessitate quick reaction times and robustness to ensure national security.

Impact of covid-19

For most of 2020, the outbreak of the COVID-19 pandemic has kept individuals quarantine in their homes worldwide. Governments have restricted movement and prohibited travel around the world to stop the spread of the disease. Undoubtedly, this has caused individuals to want to escape from isolation and enjoy life as before.

Due to the falling GDP and the disruption of large and small businesses, governments also appear to lift bans and ease restrictions from 2021. This period worked as a boon for Flywheel UPS market as during this pandemic the population became more aware and adapted towards green energy and environment conservation.

Recent Developments

• February 2024- Eaton updated its manufacturing infrastructure by implementing two new intelligent factories.
• February 2024- Regulatory approval was granted to GE Vernova's nuclear fuel business to produce fuel with a higher enrichment level.