Material Insights · Understanding the Material World

Flywheels and small mechanical stores: Economics

Why a costly store pays where fast cycling earns

What this tab covers Economics and financial structure: capital versus operating cost, levelised cost of storage, and how the asset earns money.

High cost per kWh is acceptable only where many fast cycles a day are paid for, as in frequency regulation markets.

Capex versus opex

Mixed

Stephentown cost about USD 69 million for 20 MW, roughly USD 3,450 per kW or USD 13,800 per kWh (both calculated), backed by a USD 43 million DOE loan guarantee. China's Dinglun plant cost RMB 340 million (USD 48.1 million) for 30 MW, about USD 1,600 per kW (calculated). IRENA expected energy costs to fall about 35 percent to USD 1,000 to 3,900 per kWh by 2030. A 2022 review notes Beacon's flywheel costs almost ten times a lithium-ion system of similar energy, but is competitive per kWh cycled because of its very long cycle life. Opex covers bearings, vacuum pumps and power electronics; there are no cell replacements.1234

Stephentown capex USD 69 million for 20 MW (about USD 3,450/kW, calculated)2 Dinglun capex USD 48.1 million for 30 MW (about USD 1,600/kW, calculated)1 IRENA 2030 projection USD 1,000-3,900/kWh4

Levelised cost of storage

Mixed

Levelised cost per MWh is a poor yardstick for a minutes-long store whose value lies in power and response speed; no recent LCOS estimate for flywheels was found in IEA, Lazard or PNNL sources reviewed. Investors should compare cost per MW of regulation capacity instead.4

Revenue stack and market participation

Mixed

Flywheels earn mainly from frequency regulation and fast reserves, where they respond in seconds and can cycle many times a day. Behind the meter, Torus pairs flywheels with batteries for businesses and claims millisecond response (developer claim); it signed a memorandum for up to 70 MW of demand response with Rocky Mountain Power (part of PacifiCorp) in February 2025, which it says was filled within six months, and an expanded one for up to 500 MW in September 2025 (company statements). Flywheels cannot earn from multi-hour arbitrage on their own.156

Torus demand response memoranda up to 70 MW, then up to 500 MW56 Torus funding (Sept 2025) USD 200 million from Magnetar (company release)6

Sources

  1. 'World's largest' 30MW flywheel energy storage project connects to grid in China Energy-Storage.news, 2024
  2. Milestones for flywheel, lithium battery grid-scale projects POWER Magazine, 2011
  3. A review of flywheel energy storage systems: state of the art and opportunities (Li and Palazzolo, Journal of Energy Storage 46, 103576) Elsevier (Journal of Energy Storage), 2022
  4. Electricity Storage and Renewables: Costs and Markets to 2030 IRENA, 2017
  5. Torus, Rocky Mountain Power sign MOU for up to 70 MW of demand response Utility Dive, 2025
  6. Torus raises 200 million from Magnetar for deployment of modular power plants Torus (company release), 2025