U.S. Behind-the-Meter Energy Storage Financing: Structures, Risks and the Challenging Road Ahead

Report summary

The U.S. behind-the-meter market remains small today, with only 83 megawatt-hours deployed in 2016, constituting 25% of the total MWh deployed across the nation that year. Storage remains a pricey proposition, and can pencil out only in select cases today, particularly in the behind-the-meter segment. One challenge facing storage comes in the form of a lack of financing, as few financiers are willing to back projects due to a lack of clearly monetizable value streams in most cases.

Nevertheless, despite the host of challenges staring the behind-the-meter storage market head on, developers and financiers are working to develop viable business models. These efforts have yet to translate into massive deployments, but market actors are laying the groundwork in order to build out the U.S. market. Understanding the current state of behind-the-meter storage financing today is imperative for building the business models that will catapult the industry to the gigawatt scale.