The global market for energy storage is expected to decline in 2020 due to project delays and lack of access to residential and commercial clients as a result of lockdown restrictions, says Frost & Sullivan.
However, according to the research firm’s Outlook for the Global Energy Storage Industry 2020 report, the market will rebound and witness strong capacity addition despite COVID-19 as from 2021.
The market is expected to record accelerated growth from 2022 onwards, with annual capacity additions hitting 23.3GW in 2025 up from 4.1GW in 2019.
US, Germany, Japan and China will continue to be key markets on the back of supportive regulations and incentives.
South Korea, which was the global leader in energy storage solutions in 2018, is likely to drop a few positions but remain one of the top five.
Factors driving an increase in energy storage adoption include high electricity prices, declining feed in tariffs, increasing grid demand charges and declining technology and project costs.
To stimulate growth, energy storage system companies can:
- Retrofit existing solar PV systems with additional energy storage capacity. Storage manufacturers should develop strong relationships with solar system integrators and installers.
- Leverage big data analytics to enable utilities to determine likely demand in a particular locality and deal with fluctuating customer loads.
- Forge partnerships with energy management solution providers to offer in-built, cloud-based battery monitoring and fault diagnosis platforms with relevant cybersecurity measures.
- Incorporate machine learning algorithms to develop smart self-learning systems that can optimise storage depending on renewable loads.
- Develop or partner with the providers of virtual power plant solutions, as these will become increasingly important in the decentralised energy markets of the future.
- Integrate innovative business models and multiple revenue streams such as revenue stacking.
Jonathan Robinson, energy programme lead at Frost & Sullivan, said: “The fundamentals behind an investment in energy storage remain strong.
“Residential and commercial customers are facing high energy costs and want to do something to reduce them, as well as guaranteeing security of supply –energy storage enables them to achieve this.
“Project sizes and values can vary significantly within the commercial and industrial, and grid spaces, depending on the volume of storage required and for what time period.
“Each project needs to be thoroughly assessed to ensure the solution is right-sized for customer needs – otherwise the actual ROI will not match the projected one.”
For further information about the report, visit: http://frost.ly/444