Long-Duration Energy Storage Funding Plummets 30% in 2025 Amid VC Pullback

Investment in long-duration energy storage (LDES) technologies has dropped sharply in 2025. Global funding fell by 30% compared to the previous year, with venture capital support plunging by 72%. The decline highlights ongoing financial struggles in the sector despite some large-scale commitments.

The overall drop in LDES funding excludes a major $1.76 billion pledge from the US Department of Energy, earmarked for projects led by Hydrostor. Without this injection, the decline would have been even steeper. Most companies in the sector are now facing tighter financial conditions.

Between 2021 and 2025, only three firms—Hydrostor, Eos Energy Enterprises, and Form Energy—managed to secure over $1 billion each. Together, they raised more than $4 billion, far outpacing other players in the market. No other LDES companies have reached the $500 million funding mark in the same period. The data suggests a widening gap between a few well-funded leaders and the rest of the industry. Many smaller firms are struggling to attract the same level of investment, leaving them vulnerable in a competitive market.

The sharp decline in venture capital and overall funding points to a tougher landscape for LDES development. While a handful of companies have secured substantial backing, the broader sector remains under financial strain. Future growth may depend on sustained government support and breakthroughs in cost-efficient technology.