Both Distributed and Grid-Scale Energy Storage Markets on the Rise: Navigant  

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Energy storage markets, both distributed and grid-scale, are growing quickly as batteries improve, according to two recent reports by Navigant Research.

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Navigant pegs distributed energy storage at 171.9 MW in 2014 and forecasts that it will reach about 12.1 GW in 2024. Grid-scale energy storage increases from 538.4 MW to 20.8 GW over the same time period.

For distributed energy storage, worldwide revenue is likely to exceed $16.5 billion by 2024, up from $452 million annually in 2014. The growth comes in both residential and commercial energy storage, which each far exceeded industry expectations in 2014, according to the report.

“The development of advanced battery chemistries, including lithium ion (Li-ion), flow batteries, advanced lead-acid, and other next-generation chemistries, has enabled rapid advancement in the distributed storage market,” said Anissa Dehamna, senior research analyst with Navigant Research.  “These advances are helping to meet demand for distributed and flexible resources created by the spread of solar PV, electric vehicles, electric vehicle charging, and home energy networks.”

Navigant describes the distributed energy storage market as “the focus of rapid innovation and intense competition.”

Key technology players cited in the report are Aquion Energy, FIAMM SoNick, GILDEMEISTER, Kokam, Kyocera, LG Chem, Panasonic, RedFlow Technologies and Samsung SDI.  Software and integration companies noted are: CODA Energy, E3/DC, Green Charge Networks, Greensmith Energy Management Systems, Ideal Power, Moixa Energy, S&C Electric,  Stem.

Even though the outlook is positive, the distributed energy storage market faces challenges, Navigant said. The industry needs to reduce costs, develop more effective software and controls, and become more expert in technology integration.

Companies also will need strong distribution networks, and will benefit by offering complementary products and services, such as advanced software and controls, alternative financing structures, or integrated photovoltaics.

Meanwhile, Navigant sees revenue from grid-scale energy storage totaling more than $68 billion from 2014-2024. The expansion comes as grid-scale energy storage evolves beyond what has been largely a disjointed market, according to the research firm.

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Greater use of renewable and local energy drives the need for grid-scale energy storage. Utilities are using storage to balance loads across an increasingly diverse range of assets, Navigant said.  Further, several countries are pursuing market reforms that favor the technology, among them the United States, South Korea, and Japan.

“Developing energy storage that is viable for grid applications has been a goal of vendors and grid operators for a number of years,” Dehamna said.  “Recently a number of factors, including the falling price for lithium-ion battery systems, have begun to converge to bring that goal close to fruition.”

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Pumped storage, a technology used by utilities for decades, continues to dominant in terms of installed energy storage capacity. But growth is rapid in lithium ion, power-to-gas, flow battery, and compressed air systems.

In 2013-14, companies announced 362.8 MW of grid-scale energy storage projects, almost evenly distributed between North America (103.3 MW), Asia Pacific (100.5 MW), and Western Europe (91.1 MW).

Navigant cited key grid-scale storage  players as:  EnerVault, Redflow, CAES Vendors, Hydrostor, SustainX, Beacon Power, Temporal Power, LG Chem, NEC Energy Solutions, Panasonic, Samsung SDI, Sony, Toshiba, FIAMM SoNick, GE, ABB and S&C Electric.

For more information about Navigant’s report, “Community, Residential, and Commercial Energy Storage,” go here and for “Energy Storage for the Grid and Ancillary Services” go here.

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