The installation of energy storage technologies will increase by three times per annum through 2030 as governments and utilities seek to reap the benefits of storage to achieve energy transition, according to a new report from research firm IHS Markit.
IHS Markit forecasts the global market for energy storage systems to expand by 250% between 2021 and 2030. In terms of capacity, the market is expected to increase from 7GW in 2020 to 12GW in 2021 and 30GW by 2030.
Decarbonisation goals have led to a total of 87GW of national energy storage targets for the coming years announced so far in 2021, according to the report. IHS Markit says more policies that support the deployment of renewables and energy storage systems will be enacted through 2030. Such policies are expected to simplify storage deployment and increase investments within the sector.
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The growth is despite disruptions caused by the pandemic and supply chain constraints for Li-ion batteries and other materials used in the manufacturing of storage systems. The continued increase in electric vehicles use is putting pressure on the supply of Li-ion, states IHS Markit. This will result in producers of battery cells prioritising bigger companies within the automotive sector ahead of the utility segment, according to the report. However, the supply chain constraints are expected to disappear within the next 18 months.
George Hilton, senior analyst, clean energy technology, IHS Markit, said: “Delays associated with supply tightness have not yet led to any significant reductions in the outlook for the industry and IHS Markit still expects installations to grow strongly as global supply of Li-ion batteries expands to meet demand.”
Ambitious targets introduced by governments and energy companies to expand portfolios of storage capacity will drive the growth, according to the report. For instance, China’s target to deploy 30GW by 2025. The target will expand the installation of storage systems by 14 times compared to 2020 levels. China will also become the fastest-growing region in terms of installations, will be 3 times bigger than the US and 4 times higher than Europe in terms of installations.
Owing to higher installations in China, IHS Markit predicts the Asia region will hold a lion’s share of all new storage installations.
Find out more about the report.