SustainX’s facility, a follow-up to a 40-kilowatt demonstration plant, is funded partly by a $5.4 million U.S. government grant under the 2009 American Recovery and Reinvestment Act and partly by venture capital. Richard Brody, the company’s vice president of business development, said it could start test operations by next June, though it would have only an hour or two of storage capacity and would not initially be intended to supply power to the grid. “Its goal will be to validate and demonstrate the technology to our engineering team and to customers,” he said.

Both SustainX and the German consortium are seeking to improve on the diabatic technology used in existing utility-scale facilities in Huntorf, Germany, and McIntosh, Alabama. In these systems, the operators use surplus power from the grid when demand is low to pump air at high pressure into underground salt caverns, expelling the byproduct heat into the atmosphere. When energy is needed on the grid, the air is released and reheated by burning gas before being sent through turbines to generate electricity.

In the SustainX isothermal process, a fine mist of water is used as the coolant. When grid power is needed, the compressed air is passed back through the heated water to recover the stored energy before being fed to the turbines.

A venture capital-funded start-up, LightSail Energy in Berkeley, California, has built two prototypes using similar technology — both LightSail and SustainX use specially built containers rather than underground caverns to store compressed air.

Meanwhile, General Compression in Newton, Massachusetts, is working on a near-isothermal system using salt cavern storage, like the early diabatic systems. General Compression and its partner ConocoPhillips are developing a project in western Texas.

Mr. Warshay, who has written a review of SustainX, said he expected that the project would provide valuable data. “Because it’s D.O.E.-funded, they will have to publish their performance data, which will help the industry as a whole understand the technology’s capabilities,” he said, referring to the U.S. Department of Energy. And because the technology is built with off-the-shelf components, the market will be able to estimate its cost, he added.

The German consortium, meanwhile, is seeking to develop a related adiabatic technology in which the temperature of the compressed air would be allowed to vary within a range of 600 degrees Celsius to 40 degrees Celsius, or 1,112 degrees Fahrenheit to 104 degrees Fahrenheit. Heat generated by the compression process would be stored in large, ceramic-filled concrete pressure vessels. A first planned prototype plant would have a capacity of up to 90 megawatts.