According to a recent survey by the German Energy Storage Association, the German energy storage market is still dominated by residential energy storage systems, despite a nearly six-fold year-on-year increase in revenue from grid-scale energy storage systems in 2021.
Of the country's energy storage market's total revenue of 8.9 billion euros ($9.51 billion) last year, residential energy storage systems accounted for about half of the industry's total. Of the market revenue for residential energy storage, 1.6 billion euros came from battery energy storage systems (BESS) and 3.9 billion euros from thermal energy storage systems. The segment grew by 25% overall: 23% for battery energy storage systems and 26% for thermal energy storage systems. Revenues from grid-scale energy storage systems rose 25% to €2.3 billion, the bulk of which came from pumped hydro storage at €1.8 billion.
However, revenue from grid-scale battery storage systems has grown rapidly from €78 million in 2020 to €441 million, a nearly six-fold increase. According to the German Energy Storage Association (BVES), battery storage projects benefit from higher system balancing costs. In both years, thermal energy storage system revenue accounted for 1% to 2% of the utility sector.
Fewer grid-scale energy storage systems will be deployed in 2021 than in 2020, in line with a study published by German academics in March, but the average size of energy storage projects has grown.
Drivers of the residential energy storage market include the popularity of solar power systems, which are no longer seen as a luxury given the energy crisis and the growth of electric vehicles.
Commercial and industrial projects also performed well, with revenue rising 36% to €1.94 billion in 2021, including €140 million in hydrogen projects, meaning it accounts for about 21% of the German energy storage market.
The growth in demand and customer awareness for storage deployments has also accelerated in the near term due to the impact of the Russian-Ukrainian conflict on energy prices, with commercial and industrial battery storage provider Tesvolt saying its March orders were up nearly 200% year-on-year.
