The global energy storage market is forecast to grow to 58GW/178GWh of annual deployments by 2030, with the US and China accounting for 54% of all deployments.
While near-term deployments are affected by supply chain constraints, the market will grow at a CAGR of 30%.
In 2021, 10GW/22GWh of energy storage will be deployed, and the global cumulative installed capacity will reach 27GW/56GWh by the end of the year.
At present, the largest market in the world is the United States, which installed 4GW/11GWh last year, and the cumulative installed capacity reached 7GW/17GWh.
However, relative to other countries that have achieved a 30GW energy storage target by 2025, China is likely to overtake these countries.
Meanwhile, Germany is likely to reemerge as the third largest market by 2024, largely driven by policy, this time a 200GW solar PV target that will drive battery versus residential solar adoption . Business opportunities for utility-scale energy storage are also re-emerging, BloombergNEF said.
Other notable markets include Australia's rapid growth, which could put it in fourth place by 2030, although BloombergNEF noted that the lack of revenue certainty in the utility-scale segment could make project financing more tricky.
In other words, Australia's battery energy storage economy is good for utility scale, and with the rise of renewables and state government support, that's helping to drive growth. However, the federal government's lack of a coherent renewable energy policy and the inability to secure long-term contracts for energy storage make it a purely commercial risk market.
Australia installed around 345MW/717MWh of utility scale in 2021, with an additional 646MW/1,092MWh expected to be commissioned in 2022. By 2030, BloombergNEF forecasts Australia will have 7.3GW/16.4GWh of operational battery storage, but this could drop to just 2.3GW if revenue uncertainty persists and policies are more unfavorable to renewables.
By the end of the century, India will be the fifth largest market. As widely reported in the media, the growth of India's renewable energy sector, grid strengthening, and the need to bring off-grid electrification to rural areas have generated interest.
In other regions, Southeast Asian countries, Japan and other countries have introduced more favorable energy storage policies. The construction of large-scale projects in Chile, Mexico, Dominica, El Salvador and other places heralds a turning point for energy storage in Latin America.
There has been a dramatic increase in storage for energy applications in Africa and the Middle East and this is expected to continue.
Meanwhile, in Europe, large projects in Germany, Italy, Belgium and other countries are vying for long-term revenue contracts, but overall, the interconnectedness of the continental grid, relatively low energy demand, and the lack of policies to support energy storage mean the market remains in the throes of trough. at a rather slow deployment rate.
However, it remains to be seen how the Russian-Ukrainian conflict will affect the energy security plans of European countries.
According to Bloomberg New Energy Finance, lithium-ion battery storage contributed 95% of global utility-scale capacity additions last year, with "very few exceptions", such as three new compressed air storage systems in China with a combined capacity of 170MW/760MWh.
The company expects lithium to continue to dominate the market for years to come, and expects flow batteries, electrothermal energy storage and other longer-duration technologies to remain limited to small pilots or special-purpose projects. However, BloombergNEF noted that in the future, longer-duration energy storage could become a provider of emissions-free capacity to the grid.
Supply chain challenges prevent cost declines
Meanwhile, perhaps the biggest topic in the industry right now - supply chain constraints - Bloomberg New Energy Finance says U.S. deployment figures for 2021 are 18% lower than expected, with 1.3GWh/9.7GWh of projects delayed and commissioned The date has been pushed back to this year.
Regulated markets in California, the Southwest, New York and Hawaii have had significantly longer delays than Texas's deregulated markets, as developers in these regulated markets need to renegotiate contracts with utilities.
In the UK, considered the world's largest utility-scale market, even bigger players face supply chain challenges. However, there is a growing recognition that energy storage is needed to cope with grid expansion.
Developers and investors in the UK also want to move their projects forward as quickly as possible and get into the market before ancillary services and other revenues saturate.
China is of course the global supply chain hub for the battery storage industry and has not faced immediate delays to project timelines. However, the country's energy storage industry does not have as much experience deploying downstream as it does upstream materials and manufacturing.
This means limited experience in designing and deploying large-scale energy storage projects, resulting in installations in 2021 falling short of BloombergNEF expectations.
Despite supply chain issues, energy storage will have a record year in 2021. However, these restrictions will continue to create challenges and price pressures, as price pressures caused by soaring costs of materials such as lithium, graphite and cobalt may not start to ease until 2023.
Industry-wide battery pack prices will reach $135 (858 RMB)/kWh in 2022, driven by high commodity prices and continued cost declines in consecutive years until 2021.
Since the beginning of 2021, the price of lithium carbonate has risen by 974%, cobalt by 201% and nickel by 208%.
Bloomberg New Energy Finance slashed expectations for a drop in battery storage costs. At the end of 2021, Bloomberg New Energy Finance had said that despite the "recent price surge," battery pack prices across the industry were expected to be below $100 (636 yuan)/kWh by 2024. Since 2010, prices have fallen by about 89% until last year.
Bloomberg New Energy Finance surveyed battery manufacturers, storage suppliers and developers earlier this year and found that four-hour battery storage systems are priced at $250/kWh to $400 for projects scheduled to start production in 2023 ( 2544 RMB)/kWh.
In 2021, Bloomberg New Energy Finance's survey of energy storage system costs showed an average figure of $227 (1,444 yuan)/kWh. Smaller companies are more affected by increased costs.
