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Global energy storage market takes off
2018 was a record-breaking year for energy storage. The market looks set to flourish as the energy transition accelerates.
1 minute read
Last year saw global energy storage expand to record levels, with 147% year-on-year growth in gigawatt-hour (GWh) terms. This pales in comparison to what is to come. By 2024, we forecast that the market will expand 13-fold.
What’s behind the boom?
Over the last five years, the world began to experiment with storage; in the next five, storage will become a key grid asset.
Growth in all directions in 2018
2018 saw exponential growth in the energy storage market, led by the non-residential sector in GWh terms, a surprise winner driven by huge deployments numbers in South Korea. Front-of-the-meter (FTM) projects came next, while the residential share was the smallest segment. State subsidies enable homeowners to purchase this non-essential and expensive technology. Even where subsidies are being phased out, we expect sustainable residential growth to continue.
Storage is starting to show signs of becoming a truly global market, with major development taking place across five continents as countries strive to integrate energy storage into grid operations and market structures.
Innovation drives change
Driven by technology innovation and lower costs, storage installations have ramped up over the past 10 years. Between 2013 and 2018, we saw fledgling market growth as companies experimented with energy storage solutions, reflected in a global GWh compound annual growth rate (CAGR) of 74%. Overall, deployment totals for this period were relatively small and concentrated in a handful of countries.
But given the massive scale of the cost reductions seen in recent years, global regulators, policymakers, grid operators, asset operators and developers are beginning to warm up to storage, setting the stage for the market to flourish.
Storage markets set to balloon
In the next five years, we expect major storage markets to thrive. Big deployment numbers will be a hallmark, with the market ballooning to 158 GWh from the current 12 GWh.
The US is the clear frontrunner, making up 34% of deployed GWh capacity by 2024. China (driven by state-level mandates and policy), Japan, Australia and South Korea also lead the pack. What these markets have in common are extremely ambitious renewables growth targets.
Purchase our report ‘Global Energy storage outlook 2019’ to gain an in-depth view of regional trends and how regulatory policy is supporting storage and renewable energy ambitions across the globe. Download the brochure for a detailed view of what's inside this report.
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Better energy storage growth will accelerate adoption of renewables
Increases in production capacity and a boom in storage deployments alongside falling technology costs, will assist the development of longer duration storage and accelerate the adoption of renewables. Storage technology will strengthen the reliability and resilience of electricity delivery, decoupling power supply from unpredictable and varying weather patterns.
As the global energy transition accelerates and energy markets evolve, storage will become a necessity.