In a report, Fitch said the capacity will grow at an annual average rate of 3.5%.

“With the rapid expansion of renewables, pumped hydropower storage will continue to be utilised as an energy storage solution as means to solve the intermittency issue with renewables,” it said.

“Additionally, with the increasing number of floating solar power projects, some of which have been located on reservoirs of pumped hydropower stations, we expect the increasing attractiveness of projects that couple floating solar with pumped hydropower,” Fitch added.

This type of technology uses pumps to push water to a reservoir at a higher altitude for large-scale long-duration energy storage, and turbines to produce electricity when releasing the stored water.

North America and Western Europe account for the largest capacity globally at 78GW at the end-2021 or 47% of the total share.

Fitch noted that whilst pumped hydropower storage is the “most scalable” type of energy storage solution for the markets, it is still limited by the “large-scale nature” and the requirement for vast water resources.