A small town in southern Finland has turned to the world's largest commercial sand battery to fix what many see as the most critical problem facing renewable energy: intermittency. Standing at 13 meters tall and 15 meters wide, the eye-catching facility uses 2,000 metric tons of crushed soapstone to store clean energy in the form of heat to provide 100 megawatt-hours of thermal energy. That's enough to provide the 5,000 residents of Pornainen with nearly one month of heat demand through the summer — and roughly one week of demand in the winter.

Commissioned by Finnish district heating company Loviisan Lämpö and developed by Polar Night Energy, the giant sand battery launched last year as part of a push to introduce a flexible heat production technology and reduce carbon emissions generated by the local district heating network. Polar Night Energy said the project is estimated to have slashed greenhouse gas emissions from the heating network by almost 70% and reduced the use of wood chips by about 60%. An existing wood-chip power plant remains in operation as a backup and peak-load facility.

Tommi Eronen, CEO of Polar Night Energy, said Pornainen had previously relied on burning oil and wood chips for its heating needs — but the town's sand battery was now able to provide combustion-free heating for the majority of the year. "We're changing from a world where big power plants were doing the energy production to where solar and wind are producing the energy, then we need a massive amount of storage," Eronen told CNBC on a video call. "Hopefully a big portion of those storages could be sand battery-type of storages where we don't need rare earth materials, like in many chemical batteries, such as lithium-ion batteries." The Pornainen project is about 10 times larger than an earlier version launched in the country in 2022, reinforcing the potential for sand batteries to play a more prominent role in cutting emissions both domestically and abroad.

Battery storage is widely expected to play a pivotal role in the energy transition — and sand batteries in particular have shown promise for regional heat storage, but scaling up this technology faces significant hurdles. Some notable criticisms include their ability to efficiently convert heat back to electricity and their relatively low energy density compared to traditional batteries. How does it work?

Essentially, the sand battery technology operates as something akin to a giant thermos with heat-storing material. The first step is to get electricity off the grid when there is plenty of wind or solar power, before then heating up the sand to very high temperatures. The heavily insulated silo keeps that heat trapped for days or weeks before being discharged via heat exchangers to warm water for the local district heating network.

"Three steps — and the key to the whole thing is the sand enables you to have a delay between the time you use electricity, and you use the steam," Polar Night Energy's Chief Commercial Officer Annette Höglund-Dönnes told CNBC by video call. "That delay is your business advantage because you can heat up the sand when the electricity is cheap, and you use the steam when normally it would be very expensive to produce steam off the grid, which is the daytime when everybody else is using it," she added.