One-fifth of the world’s total energy consumption comes from industrial heat production.
Of this, 80 percent is still generated using fossil fuels such as oil and gas. Industrial heat production is one of the largest and hardest-to-solve sources of carbon emissions worldwide.
Finnish cleantech startup TheStorage has developed a solution that could cut energy costs by up to 70 percent and carbon emissions by up to 90 percent.
The system converts renewable electricity into heat, stores it in sand, and delivers it for on-demand industrial heating.
Blind spot of decarbonisation: industrial heat
Recent energy debates have focused heavily on electricity, but for industrial emissions, heat is the critical issue.
Hot steam is required across industries, from food production to chemical processing.
The majority of industrial energy use comes from heat production, which is still largely based on fossil fuels.
Electrifying industrial heat has been challenging due to the variable availability of renewable energy. Industry requires a consistent supply of heat throughout the year.
The idea emerged in Finland in 2023, engineering work started in 2024, and in January 2026, the first industrial-scale pilot was installed at a brewery for real-world industrial testing. There, it produces fossil-free steam for the brewery’s production lines.
"Producing steam without fossil fuels is a major step toward carbon-neutral production," says Vesa Peltola, Production Director of the brewery.
Sand as the industry’s green energy bank
TheStorage’s technology captures electricity when it is abundant and cheap, converts it into high-temperature heat, and stores it in sand. This stored heat can be used in industrial processes independently of real-time electricity availability.
“Companies have wanted to decarbonise for years, but viable solutions simply weren't available,” says Timo Siukkola, CEO of TheStorage.
“Finally, renewable energy generation can meet industrial heat demand in a way that's both ecologically sound and economically practical.”
The principle of the sand-based heat storage is simple: the proprietary technology stores heat in ordinary sand using two insulated silos, an electric heater, and a heat exchanger.
Cool sand moves from a cold silo to an electric heater, reaching temperatures up to 800°C.
The heated sand is then stored in a hot silo, where energy is efficiently retained in stationary sand.
By circulating the sand through an external heat exchanger, the system delivers steam with up to tenfold higher heat transfer efficiency than conventional static storage systems.
The stored heat can be released on demand as steam or thermal oil, providing stable power that can be quickly adjusted to match demand.
The solution is scalable from 20 to 500MWh with charging power from 1 to 20MW, depending on industrial needs.
The technology allows fully flexible operations in both charging and discharging.
Fossil-free industrial heat is crucial to achieving the EU's climate goals, which aim for a 90 percent reduction in emissions by 2040 and full carbon neutrality by 2050.
For companies, these targets are increasingly concrete obligations: the Corporate Sustainability Reporting Directive (CSRD) requires large and medium-sized companies to report on energy use and emissions, while the EU Emissions Trading System (ETS) makes fossil fuel use increasingly expensive.
Heat emissions now appear simultaneously in sustainability reports, energy costs, and customer requirements," Siukkola explains.
Pressure comes not only from regulation, but also from international corporations, which increasingly require suppliers to demonstrate measurable emission reductions under the Science Based Targets initiative (SBTi).
“This forces industrial companies to reconsider how they produce heat to remain competitive in global supply chains," Siukkola concludes.