Canada’s first commercial-scale 30.7 GWh CAES plant in Alberta shows how long-duration storage, hydrogen and AI-enabled optimization are reshaping green energy.
Most companies chasing “green tech” headlines obsess over shiny new solar panels or giant batteries. Quietly, Canada is about to flip the switch on something far more interesting: a 30.7 GWh compressed air energy storage plant that can run for 48 hours straight.
This matters because long-duration energy storage is the missing piece in every clean energy strategy. Solar and wind are cheap, but they’re not always available. Short 2–4 hour lithium-ion batteries can help with evening peaks, but they can’t ride out a windless winter weekend or a deep cold snap on their own. Alberta, with its deregulated power market and growing renewables fleet, is exactly where this problem shows up first.
Cache Power’s new project near Marguerite Lake in Northeast Alberta is being billed as Canada’s first commercial-scale compressed air energy storage (CAES) facility. Behind that headline is a much bigger story about how green technology, smart engineering, and even hydrogen and carbon capture are starting to intersect.
In this post, I’ll break down what CAES actually is, why this project is such a big deal for grids shifting to net zero, and how businesses can think about long-duration storage as part of their own decarbonization roadmap.
What makes Cache Power’s CAES project so important?
Cache Power’s Alberta facility is one of the largest green energy storage projects in North America by delivered energy, with 30.72 GWh of storage and up to 48 hours of discharge. That puts it in a different league from most battery projects, which are typically rated for 2–8 hours.
Here’s what’s being developed at Marguerite Lake:
- Location: Next to the Marguerite Lake substation in Northeast Alberta
- Power rating: 250 MW charging (load), 640 MW discharging (generation)
- Energy capacity: 30.72 GWh, up to 48 hours of output
- Storage medium: Underground salt caverns created through solution mining
- Technology: Modern “D-CAES” (diabatic CAES) using advanced compressors and expanders from Siemens Energy
- Fuel flexibility: Ability to blend up to 75% hydrogen with natural gas, with a roadmap to 100% hydrogen
- Partnerships: Engineered with Federation Engineering, constructed with EllisDon, with Indigenous partnership from Cold Lake First Nations
From a grid operator’s point of view, this isn’t just another storage project. A 640 MW plant that can run for two days is effectively a flexible, low-carbon peaker plant plus backup system. It can:
- Absorb excess wind and solar when prices crash
- Cover prolonged supply gaps during weather events
- Provide firm capacity and grid stability services
- Reduce reliance on conventional gas peaker plants
For Alberta—a province still heavily reliant on fossil generation—this is a serious step toward a net-zero electricity system that doesn’t compromise reliability.
How compressed air energy storage actually works
Compressed air energy storage is straightforward in concept: use cheap electricity to compress air, store it underground, then expand it later through a turbine to generate power. The nuance is in how you handle heat and pressure.
The basic CAES cycle
A CAES plant works in two main modes:
-
Charging (storing energy)
- Electric compressors consume power from the grid
- Air is compressed to high pressure
- The compressed air is stored in underground salt caverns
-
Discharging (producing energy)
- Stored compressed air is released from the caverns
- It’s heated (using fuel, or stored heat in some systems)
- The hot, high-pressure air expands through a turbine
- The turbine drives a generator and feeds power back to the grid
Traditional CAES projects—like Huntorf in Germany (1978) and McIntosh in the US (1991)—were only able to recover less than 50% of the energy they used to compress the air. Most of the heat generated during compression was simply rejected to the environment.
What’s different about this “new” CAES?
Cache Power’s plant uses modern D-CAES technology from Siemens Energy, which is a big upgrade over those early designs:
- Multi-stage, integrally geared, intercooled compressors make compression more efficient and reduce waste heat.
- Dual-reheat recuperators with ~90% effectiveness capture and reuse heat during expansion, boosting round-trip efficiency.
- The result: a diabatic CAES system that doesn’t fit the old “inefficient CAES” stereotype.
As Jordan Costley, President of Cache Power, explained, this isn’t the same “conventional CAES” that many people still reference. The thermodynamics have caught up with modern expectations.
If you care about green technology that scales, this kind of incremental but real engineering progress matters more than buzzwords. You don’t need magical physics—just smart use of compression, heat management, and geology.
CAES vs A-CAES vs batteries: where each storage tech fits
The energy storage space isn’t a winner-takes-all situation. Different technologies win in different use cases. CAES, advanced CAES (A-CAES), and lithium-ion batteries all have a natural “sweet spot.”
CAES and A-CAES: long-duration workhorses
Canada already has an A-CAES pioneer: Hydrostor, based in Ontario. Its projects show a different approach to compressed air storage:
- A-CAES (advanced CAES) captures heat from compression, stores it (often in pressurized water), and reuses it when expanding the air.
- This removes or sharply reduces the need for fossil fuels during discharge
- It’s designed as long-duration, low-carbon storage from the ground up
Hydrostor has:
- Two operational projects in Canada, including a 2.2 MW / 10 MWh commercial A-CAES plant in Goderich, Ontario
- Large projects under development, like 1.6 GWh Silver City in Australia and 4 GWh Willow Rock in California
Cache Power’s Alberta project, by contrast, is:
- Much larger in delivered energy (30.72 GWh vs the tens or low thousands of MWh range)
- Designed as a commercial-scale D-CAES plant with fuel input, but evolving toward a hydrogen-capable, low-carbon configuration
So how do these compare to batteries?
Where batteries still shine
Lithium-ion batteries are fantastic for:
- 1–4 hour peaks and frequency regulation
- Fast response and grid balancing on minute-to-minute timescales
- Co-location with solar for clipping and time-shifting
But for multi-day storage, the economics shift. Scaling batteries from 4 hours to 40 hours means multiplying the number of cells—and the cost—by 10. At that point, CAES and A-CAES start to look far more attractive per unit of stored energy, especially when you can re-use geological formations like salt caverns.
The reality: a robust net-zero grid will likely use both:
- Batteries for short-duration, high-frequency control
- CAES/A-CAES for multi-hour to multi-day firming and seasonal balancing
If you’re planning a decarbonization strategy, you want your portfolio to look the same way—multiple storage types, matched to clearly defined roles.
Hydrogen, carbon capture, and the path to net-zero storage
The Alberta project is more than just compressed air; it’s also a proving ground for hydrogen and carbon-aware generation.
Blending hydrogen with natural gas
Cache Power’s plant can blend up to 75% hydrogen with natural gas, with a long-term plan for 100% hydrogen utilization. That’s a big deal for two reasons:
- It directly cuts combustion emissions on day one.
- It creates a flexible offtake for low-carbon hydrogen produced in Alberta’s emerging hydrogen economy.
Hydrogen isn’t a silver bullet, but pairing it with CAES in this way builds a bridge: you get firm, dispatchable power now, with a clear pathway to near-zero emissions as hydrogen supply scales and green hydrogen prices fall.
BrightLoop: clean hydrogen plus captured CO₂
Power plant supplier Babcock & Wilcox is working with Cache Power on a potential hydrogen expansion using its BrightLoop technology. BrightLoop is designed to:
- Produce hydrogen
- Isolate CO₂ for capture and storage
If that integration works as expected, you get a storage plant that:
- Uses CAES for long-duration flexibility
- Uses hydrogen as a clean fuel input
- Captures and stores any associated CO₂
From a green technology and AI-powered energy planning standpoint, systems like this are a dream: they create multiple controllable variables—fuel blend, compression timing, discharge profile, carbon intensity—that advanced analytics and AI can optimize in real time.
This is where AI quietly becomes essential. Software can:
- Forecast wind, solar, and price curves
- Decide when to charge caverns and when to discharge into the grid
- Optimize hydrogen production vs. use
- Keep carbon intensity below policy thresholds, hour by hour
Long-duration storage plus hydrogen plus smart optimization is what a mature net-zero power system actually looks like in practice.
Local benefits, Indigenous partnership, and why projects like this win support
One reason long-duration energy storage projects advance while others stall is how they’re structured socially and economically, not just technically.
Cache Power has explicitly committed to economic and social benefits for local communities and Indigenous partners.
- Cold Lake First Nations has been actively involved in development
- They’re expected to partner in both the project and its long-term operations
This isn’t a side note. Community equity and Indigenous leadership are becoming non-negotiable elements of major green infrastructure projects, especially in Canada.
For businesses watching from the sidelines, here are a few practical lessons:
- Align early with local stakeholders. Bringing communities in as partners instead of opponents is both the ethical and effective approach.
- Treat green technology as economic development, not just emissions reduction. Projects that create skilled jobs, training pathways, and long-term revenue-sharing are far more durable.
- Design for co-benefits. In this case: grid reliability, climate goals, local employment, and Indigenous partnership all stack.
Most companies get this wrong by treating sustainability as a narrow carbon exercise. The projects that move—like this CAES plant—link climate, resilience, economics, and community in one story.
What this means for businesses planning their own green tech strategy
Here’s the thing about long-duration energy storage: it’s not just a utility problem. It’s quickly becoming a strategic lever for large energy users.
If you’re a utility-scale developer, heavy industrial, data center operator, or large commercial energy user, projects like Cache Power’s CAES plant point to a few clear moves:
- Plan for a mix of storage durations. Don’t treat “battery storage” as a single category. Short-duration and long-duration solve completely different problems.
- Start integrating long-duration storage into your scenarios. Whether it’s CAES, A-CAES, pumped hydro, or thermal storage, long-duration assets will shape future power prices and reliability.
- Use AI and advanced analytics to value flexibility. The value of CAES isn’t just MWh; it’s the ability to buy energy low, sell high, and deliver firm capacity during stress events. That’s a problem tailor-made for AI optimization.
- Look for partnership opportunities. If you operate in markets like Alberta, long-duration storage plants can be strategic allies: offering capacity contracts, backup for electrified operations, or hedges against extreme price spikes.
- Think beyond compliance. The businesses that win in green technology aren’t simply “avoiding penalties.” They’re building energy portfolios that are cheaper, cleaner, and more resilient than their competitors.
If your organization is trying to design a credible net-zero strategy, it’s time to treat long-duration energy storage as a core pillar, not an afterthought.
Where long-duration storage fits in the Green Technology story
CAES in Alberta isn’t just an engineering project; it’s a preview of where green technology is headed:
- Physical infrastructure—caverns, compressors, turbines
- Clean fuels—hydrogen with carbon capture
- Smart software—AI-driven control and optimization
- Social license—Indigenous partnership and local benefits
As more grids push toward net-zero in the 2030s, we’ll see a lot more of this stacked approach: multiple technologies, layered together, orchestrated by data and AI.
If you’re building a strategy around clean energy, smart cities, or sustainable industry, long-duration storage should already be on your radar. The Alberta CAES project shows that 30+ GWh green power “banks” aren’t theory anymore—they’re being permitted, financed, and built.
The next question is simple: will you be reacting to this shift, or using it as an advantage in how you design your own operations and energy strategy?