According to a recent LinkedIn post from Electrified Thermal Solutions, new analysis from McKinsey & Company outlines a favorable economic outlook for industrial heat electrification and thermal energy storage in Europe. The post cites projections that thermal storage projects could generate returns above 15% in most major European markets by 2030, with Spain approaching 20%.
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The post highlights McKinsey’s view that, in several European markets, day-ahead electricity prices are already below the cost of gas, including CO₂ costs, 15 to 40% of the time. According to the content, thermal storage is presented as a way for operators to arbitrage these price differentials by charging with low-cost electricity and providing heat on demand.
As shared in the post, McKinsey estimates that European thermal storage capacity could expand from under 0.5 GWh today to more than 200 GWh by 2035, implying a deployment opportunity of roughly €16 billion within this decade. The company’s Joule Hive™ technology is described as targeting this market segment by storing low-cost renewable electricity and supplying industrial-grade heat at costs intended to be competitive with natural gas.
For investors, the post suggests a sizable addressable market in Europe for thermal energy storage solutions linked to industrial decarbonization and the energy transition. If the projected returns and capacity growth materialize, companies positioned in thermal storage and electrified industrial heat, including Electrified Thermal Solutions, could benefit from increased capital deployment and policy support in the region.
The emphasis on reduced exposure to fossil fuel price swings and CO₂ costs indicates potential resilience in volatile energy markets. However, actual financial outcomes will depend on technology performance, regulatory frameworks, electricity price dynamics, and the pace at which industrial customers adopt electrified heat solutions across different European jurisdictions.