Energy Storage to Become ‘Key Grid Asset’ with 13-Fold Growth Through 2024
The capacity of energy storage systems around the world is set to increase thirteenfold over six years, from 12 gigawatt-hours of installed capacity in 2018 to an astonishing 158 GWh in 2024, according to a new market assessment by Wood Mackenzie Power & Renewables.
“Over the last five years, the world began to experiment with storage,” said Ravi Manghani, head of storage research at WoodMac. “In the next five, storage will become a key grid asset.”
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The growth surge “equates to US$71 billion in investment into storage systems excluding pumped hydro, with $14 billion of that coming in 2024 alone,” Greentech Media reports. “And much like the renewables that are driving their growth, the batteries that make up the lion’s share of new storage systems being deployed are falling in price. That’s positioning them for a much broader integration into grid operations, beyond renewables integration.”
The United States and China will account for 54% of the new deployments, Greentech says, “followed by Japan, Australia, and South Korea in a second tier of growth markets, and Germany, Canada, India, and the UK rounding out the list.”
The industry publication adds that “each of these markets is taking its own approach to integrating energy storage into its grid operations and market structures, from the state-by-state development in the U.S. to China’s five-year plan. But they share a commitment to relatively aggressive renewables growth targets, along with the attendant challenges of integrating an increasing share of intermittent wind and solar power into the grid.”
The report indicates that energy storage grew at a compound annual rate of 74% from 2013 to 2018. But in 2018, the growth rate hit 147%, enough to deliver 3.3 gigawatts/6.0 gigawatt-hours of capacity. Those deployments accounted for more than half of the activity over the five-year span, “indicating an inflection in storage demand,” Manghani said.The Greentech story summarizes key dynamics in each of the major national markets identified in the Wood Mackenzie report. In Canada, “last year’s efforts to incorporate energy storage into wholesale markets in Ontario and Alberta have been counterbalanced somewhat by the new Ontario government’s decision to cancel hundreds of renewable energy projects.”