Continued improvements in manufacturing and supply chain efficiencies coupled with incremental improvements in energy density are expected to yield an additional 46% reduction in average lithium-ion cell prices through 2029.
Declining prices for energy storage technologies continue to be the biggest driver of growth for both the EV and stationary grid energy storage markets, according to Guidehouse Insights.
These declining prices are opening new markets and profitable applications for grid storage to compete with conventional fossil fuel generation technologies.
Simultaneously, the falling price of batteries allows lower-priced EVs with longer driving ranges to compete directly with gasoline and diesel vehicles.
Other advanced battery technologies and electromechanical energy storage system (ESS) technologies are gaining traction for grid storage due to their operating characteristics and better safety profiles. However, project size variation and different configurations result in a wide array of reported prices.
Alex Eller, a senior research analyst with Guidehouse Insights, said: “Although supply shortages in 2018 and 2019 temporarily limited price reductions as demand outpaced supply, the industry is seeing aggressive declines in Li-ion battery prices.
“The primary factor driving these price declines is the rapidly growing capacity of global battery manufacturing.”
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