Battery Energy Storage System market for Residential, Non-Residential, Utilities applications 2023
The battery energy storage system market is estimated to grow from USD 1.98 Billion in 2018 to reach USD 8.54 Billion by 2023, at a CAGR of 33.9% between 2018 and 2023.
Know more about Battery Energy Storage System Market
The major factors driving the growth of the market include the increasing demand for grid-connected solutions, high demand for the lithium-ion technology in the renewable energy industry, and declining prices of lithium-ion batteries. However, the installation of battery energy storage systems in remote locations is one of the challenges for the players in the market.
Battery Energy Storage System Market, by Application:
- Residential
- Non-Residential
- Utilities
- Other Application
Utility-owned battery energy storage system held a major share of the market in 2017
The utility-owned ownership type held the major share of the battery energy storage system market in 2017. The ability of the utility-owned battery energy storage systems to manage large energy requirements during peak hours is supporting the adoption of these systems. According to the Energy Storage Association, US, the utility-based battery storage installed capacity grew by 221 MW in 2016. This shows the high dependence of the customers on the utility-owned battery storage systems for their energy requirements.
Utilities to hold largest size of the battery energy storage system market during the forecast period
Battery energy storage system is well suited for smoothing the variable output of renewables and controlling the rapid ramping up and down of solar as well as wind generation. The grid operators and regulators are aware of the importance of battery energy storage systems and their ability to cater through multiple services. The utility operators are using these systems in their resource planning processes, which reduces the system costs and increases storage capacity.
The market for residential application is expected to grow at the highest CAGR between 2018 and 2023.
The battery energy storage systems have the ability to store energy during the peak production period, leading to less wastage of energy. This is driving their adoption in the residential applications, as the residential sector worldwide is driving toward the adoption of renewable energy sources for accomplishing the routine tasks. The major companies offering battery energy storage systems for the residential application are Samsung SDI and Tesla.
The market for on-grid connection is expected to grow at a higher CAGR between 2018 and 2023.
The on-grid connections have lower upfront costs than the off-grid systems as the surplus energy is sent to the grid, which can be used later on the meter basis. The reduction in the energy bills for the customers relying on utility grid for electricity drives the growth of this market. The demand from renewable energies suppliers for grid modernization and new regulatory policies for the energy sector are driving the on-grid battery energy storage system market for utilities.
The battery energy storage system market in APAC is expected to grow at the highest CAGR between 2018 and 2023.
APAC is gradually becoming a hub for the battery energy storage system industry, and the demand for these systems from China, India, and Japan is gradually increasing. In December 2017, Hyundai planned to build and install a 150 MW energy storage battery near Ulsan, at the southeast coast of South Korea. Hyundai plans to build its battery energy storage system, which will be ~50% bigger than Tesla's 129 MWh grid storage battery installed in South Australia. The government of South Australia has invested USD 113.6 million in November 2017 for 4 utility-scale energy storage projects, and one of these 4 has the battery energy storage system deployed in it. Such developments and investments are fostering the growth of the battery energy storage system market in APAC.
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