Battery Energy Storage Market Size, Share & COVID-19 Impact Analysis, By Battery Type (Lithium-Ion Battery, Lead Acid Battery, Flow Battery, and Others), By Connectivity (Off-Grid and On-Grid), By Application (Residential, Non-Residential, Utility, and Others), By Ownership (Customer-Owned, Third-Party Owned, and Utility-Owned), and Regional Forecast, 2022-2029

The global battery energy storage market size was valued at USD 9.21 billion in 2021 and is projected to grow from USD 10.88 billion in 2022 to USD 31.20 billion by 2029, exhibiting a CAGR of 16.3% during the forecast period. The global COVID-19 pandemic has been unprecedented and staggering, with battery energy storage systems experiencing higher-than-anticipated demand across all regions compared to pre-pandemic levels. Based on our analysis, the global market exhibited a growth of about 33.6% in 2020 as compared to 2019.

Energy is a quintessential need needed to lead day-to-day activities across private, commercial, industrial, and numerous different verticals. Different organizations and countries are constantly endeavoring to secure agreements with innovation system stakeholders with the quickly expanding electricity demand in different sectors. Moreover, continually rising unsafe ozone-harming greenhouse gas (GHG) discharges have forced organizations to take on low carbon emission frameworks while generating energy. Subsequently, one such facet significantly creating innovation is Battery Energy Storage Systems (BESS) that use different battery chemistries to store energy to serve extreme demand.

COVID-19 IMPACT

Stoppage in Supply Chains amid COVID-19 Pandemic to Hamper Market Growth

The abrupt outbreak of COVID-19, or coronavirus disease, has affected different countries across the globe. A worldwide crisis, such as the COVID-19 pandemic, has altogether impacted other business and modern tasks around the world. The outcome of the pandemic has additionally left the economies of various fast-growing developing countries in unrest. Virtually all the nations across the world have noticed a surge in the number of the impacted population since the start of 2020.

However, the national administrations have set significant targets to move the 'green wave' brought about by interferences of industrial processes leaning toward the industry landscape. Moreover, various state governments' supportive economic stimulus packages combined with industry players' persistent endeavors are set to boost the interest for BESS units. For example, in August 2020, ABB announced to combine efforts with Zenobē Energy Limited, a BESS producer, to give an advanced traction power solution for the U.K. railroads. The association plans to manufacture a 25 kilovolt (kV) rail traction power system framework to convey yield by converting power from batteries over to proceed with a continuous power supply to trains.

LATEST TRENDS

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Investment in Designing and Manufacturing of BESS Devices to Play a Significant Role in Industry Dynamics

Various industry players are ceaselessly endeavoring to start new natural and inorganic extensions to boost their product acceptability across the globe. Likewise, various players are presenting new and advanced BESS units to keep up with the growth across the business. For example, in March 2021, Tesvolt, a German storage system manufacturer, launched a technologically advanced product line TS-I HV 80 battery, for the most part, created to shave load peaks and comply with the demand from business and modern clients.

Expanding Grid Infrastructure to Unlock New Opportunities for Market Growth

The exponential demand for energy resources across developing and developed countries, combined with expanding measures to guarantee energy security, is set to push the market growth. Furthermore, advancements in the rising integration of new power generation technologies and revamping existing foundations have increased the requirement for new grid systems with effective backup and peak load characteristics. For example, in June 2020, National Thermal Power Corporation (NTPC) Limited, an India-based free power maker (IPP), announced its arrangements to convey around 1 GWh BESS across the principal matrix scale age offices.

DRIVING FACTORS

Paradigm Shift Toward Low Carbon Energy Generation to Increase BESS Demand

The shift toward low carbon energy generation to reduce greenhouse gases emission has propelled the growth of the market in different regions. Huge investments have been witnessed in various battery energy storage systems by nations to meet their green energy targets. The residential, non-residential, and utility sectors have deployed numerous systems for accumulating and transferring power generated, using concentrated solar power and wind energy. Energy storage can be achieved via various technologies, of which majorly used technologies are solid-state batteries, flow batteries, thermal energy storage systems, and pumped hydro storage.

Furthermore, growing initiatives by various organizations to set up new plants to establish large-scale storage infrastructures with low carbon discharges are also projected to add to the industry outlook. For instance, in March 2021, Pacific Green, a clean energy technology company operating across the globe, announced to initiate an exclusive agreement with an infrastructure project developer TUPA Energy to establish a battery energy storage system with a capacity of 1.1 GW in the U.K. as part of the TUPA agreement. The company also acquired the rights to 100MW of BESS in Kent, U.K. and plans to conclude the remaining 1,000MW by 2023.

Rising Peak Energy Demand and Favorable Policy Framework to Augment Market Size

The increasing population across the world, coupled with growing initiatives to boost rural electrification, has increased the peak energy demand. Besides, the increased rate of urbanization and the introduction of infrastructure projects have increased the power supply-demand from utilities.

For example, as per the Italian transmission system operator (TSO) Terna S.p.A., the total peak load in the country reached a maximum of about 55.16 GW during the year 2020. The company further stated that the lowest value of the national peak load was around 37.44 GW in the same year, observing a steep change of over 47.3% between the lowest and highest demands.

RESTRAINING FACTORS

High Initial Investment May Hinder Market Pace

The primary factor that restrains the battery energy storage market growth is the requirement of substantial capital investments. These systems are mainly deployed for large BESS plants to cater to the energy demand at peak loads. For instance, as per the Energy Sector Management Assistance Program (ESMAP), a particular unit administered by the World Bank reported that the total installed cost of various energy storage technologies can vary in a substantial range from just over USD 2,000 per kW and growing up to around USD 3,300 kW, impacting the initial capital expenditures. However, the continuous research and development activities to improve the performance features of the batteries while decreasing the capital required for new systems are likely to counterbalance the market growth during the forecast period.

SEGMENTATION

By Type Analysis

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Lithium-ion Battery Segment to Dominate Market

Based on type, the market is categorized into lithium-ion battery, lead-acid battery, flow battery, and others. The lithium-ion battery segment is projected to lead the industry and is anticipated to hold a significant portion of the global market during the forecast period. Increasing deployment of new large-capacity grid infrastructure, along with continuous advancements in Li-ion BESS products, will drive the segment growth. Demand for lead-acid batteries will be fostered by the transportation sector slated to grow exponentially at the end of 2029 due to increasing hybridization of vehicle fleets and their safe & reliable operations in rechargeable systems. Furthermore, various companies are investing in expanding operational capabilities of different types, such as vanadium redox (VRB) flow batteries, to cater to the increasing need across numerous applications.

By Connectivity Analysis

On-grid Segment Size to Underpin Substantial Growth

The market is bifurcated into off-grid and on-grid based on connectivity. Continuous launch of BESS expansion projects by various large and small scale utility companies is set to favor the on-grid BESS market size. The growing setup of vast electricity networks by public and private utility companies and increasing investments to revolutionize the grid infrastructure are set to favor the segment scenario.

By Application Analysis

Utility Segment is Backed by Growing Grid Expansion Plans and Large Power Generation Facilities

By application, the market is segmented into residential, non-residential, utility, and others. Clear directives to boost the integration of storage devices across solar power technologies coupled with rapidly expanding residential solar power installation are set to favor the residential segment size.

The utility segment is projected to account for the leading share in the industry due to increasing electrification initiatives to power distant and remote locations. Further, the non-residential segment is anticipated to grow steadily due to the setup of new advanced commercial & industrial infrastructures coupled with increasing demand for energy security across the verticals.

By Ownership Analysis

Customer Owned industry to Observe Significant Growth over the Forecast Period

The market is trifurcated into customer-owned, third-party-owned, and utility-owned based on ownership. The presence of different solutions providers & manufacturers of compact & small renewable energy systems in the region is expected to favor the customer-owned segment to rise.

The utility-owned segment held the largest battery energy storage market share in the global market in 2021. The rise in investment from the government & non-government utility companies will propel the demand for utility-owned BESS units in the coming years. Furthermore, the third-party-owned segment growth is backed by continuous partnerships by different players to establish BESS networks, especially across low-income areas.

By Capacity Analysis

Based on capacity, the market is predominantly bifurcated into small scale (less than 1 MW) and large scale (greater than 1 MW). The large scale segment is projected to hold the major share of the market, owing to significant usage of advanced technologies to simulate the operational capabilities of the grid networks mandated by regional regulatory policies.

REGIONAL INSIGHTS

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The market is analyzed geographically across four main regions, Europe, North America, Asia Pacific, and the Rest of the World. The Asia Pacific market size was estimated at USD 4.16 billion in 2021 and is projected to account for the major share in terms of value and volume. The exponential increase in industrialization & urbanization, new electrification targets, renewable energy generation capacity and the presence of various industry players are some of the drivers supporting the regional outlook.

Furthermore, the North America market is projected to observe significant growth over the forecast period. The availability of favorable government policies, tax benefits for renewable deployment, and growing investments by public and private companies are some of the critical features promoting the expansion of regional market size. For instance, in September 2019, the Senate Energy and Natural Resources Committee presented an amended draft of the Better Energy Storage Technology (BEST) Act to propel research on long-duration BESS units, among other features. The legislation is a combination of various bills, including the Expanding Access to Sustainable Energy Act of 2019, Promoting Grid Storage Act of 2019, the Joint Long-Term Storage Act of 2019, and the Reducing the Cost of Energy Storage Act of 2019 to deliver a comprehensive framework for BESS facilities.

The Europe battery energy storage market size is favored by significant installation of different power generation technologies along with encouraging government and organizational policy frameworks to deploy green energy solutions in different areas. The region is also supported by increasing investments and plans to expand and fortify the grid infrastructure networks and energy security policies stimulating demand for BESS devices.

KEY INDUSTRY PLAYERS

ABB Focus on Acquiring New Contracts through its Subsidiaries to Fortify its Position in Industry

The global market has observed a significant number of players delivering a wide range of products & solutions to bolster their position. The industry has also experienced steady involvement of key global and regional players along with several small & medium scale system integrators.

ABB, a Swedish company, is gearing to convey its solid BESS products & solutions portfolio for various energy generating plants across the globe. For example, in May 2021, the organization's joint endeavor association, Hitachi ABB Power Grids, pronounced a savvy modern park in Thailand with its imaginative BESS units and controls innovation.

Additionally, Samsung SDI, Total, LG Chem, and GE are among the leading players delivering numerous types of advanced energy storage battery systems & solutions. These participants are also concentrating on R&D activities to extend their product reach across different applications and grasp new contracts with large-capacity projects.

LIST OF KEY COMPANIES PROFILED:

• GE (U.S.)


• ABB (Switzerland)


• Samsung SDI (South Korea)


• Hitachi Chemical Co., Ltd. (Japan)


• Siemens Energy (Germany)


• Total (France)


• LG Chem (South Korea)


• Fluence (U.S.)


• Narada (China)


• VRB Energy (Canada)


• Kokam (South Korea)


• EVE Energy Co., Ltd. (China)


• Black & Veatch (U.S.)


• Hitachi ABB Power Grids (Switzerland)

KEY INDUSTRY DEVELOPMENTS:

• December 2021 – TotalEnergies completed the construction of battery based energy storage facility in Dunkirk, France. The facility has a capacity of 61 MW and a total storage capacity of 61 megawatt-hours (MWh). The project was chosen as part of the long-term plan rolled out by the French Electricity Transmission Network (RTE) in February 2020. The commissioning of the site is believed to be a breakthrough in the growth of TotalEnergies' battery energy storage capabilities.


• April 2021 – ABB Power Grids announced a joint partnership with Atlas Renewable Energy to deploy and develop utility-scale battery energy storage systems (BESS) for Atlas’ renewable energy projects. Through the partnership, ABB and Atlas will integrate energy storage systems into the design of early development stage projects, with Hitachi ABB providing input on the appropriate technical solutions as well as interconnections.

REPORT COVERAGE

An Infographic Representation of Battery Energy Storage Market

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The research report offers a qualitative and quantitative in-depth analysis of the global industry. It further provides details on the adoption of BESS systems across several regions. The report provides a detailed competitive landscape by presenting information on key players and their strategies in the market. Information on trends, drivers, opportunities, threats, and market restraints can further help stakeholders gain valuable insights into the market.

Report Scope & Segmentation