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The global lead acid battery for energy storage market size was USD 7.36 billion in 2019 and is projected to reach USD 9.73 billion by 2027, growing at a CAGR of 3.6% during the forecast period. Characteristics such as rechargeability and ability to cope with the sudden thrust for high power have been the major factors driving their adoption across various application sectors.
The lead acid battery is one of the longest-serving battery types in the energy storage market. The starting, lighting and ignition (SLI) batteries being used in automobiles and electric vehicles are mostly lead acid batteries as these can provide the required power for starting a vehicle and are also charged during its operation.
Positive and Negative Effects of Covid-19 on Battery Storage Systems
The novel COVID-19 virus has deeply impacted the whole supply chain of the new upcoming projects for renewable energy and battery energy storage systems (BESS). Solar energy and wind energy projects which are the major application sectors for the deployment of the lead-acid batteries are expected to be pushed further ahead of their original deadlines. This will certainly affect the planned investments and pipeline projects for the given year. For instance, Siemens Gamesa which is one of the leading turbine suppliers to wind industry expects USD 1.2 billion sales cut during the given year. The factors contributing to this are fewer sales than usual and slower execution of projects. The ongoing renewable energy and energy storage systems projects, however, will not be affected by the pandemic as the demand for power has increased at residential locations in the lockdown period.
The battery energy storage industry is expected to grow and recover at a rapid rate as compared to other industries affected by the global pandemic. Also, following the pandemic situation the demand for backup systems is expected to surge at an exponential level for residential and commercial applications. Work from home service provided by companies to their employees and increasing demand for new projects such as DEG (Distributed Energy Generation) and VPP (Virtual Power Plants) to be implemented will be the key driving factors. The DEG and VPP use battery storage systems that result in a considerable amount of cost savings for customers and reduce the power generation load on utility companies.
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Increasing Need of Batteries for Backup Power Systems Will Drive Investments
As the world has moved to a more competitive state the demand for production and continuous work has become a necessity in many of the industrial and commercial sectors. This has led to an increase in the number of battery installations at commercial offices and industries to cope up with the power cuts and maintain the working hours, which is driving the lead acid battery for energy storage market growth. Also, the rising rooftop solar installations have surged the installations of batteries to satisfy the demand for backup power at residential locations. Advanced equipment is being heavily demanded by military units worldwide which require a reliable backup power source in difficult operating conditions.
Introduction of New Technologies Is Fueling Market Growth for Lead Acid Battery for Energy Storage
Distributed energy generation and virtual power plants are the modern-day technologies that are being used to satisfy the power demand and for ensuring the continuous power supply to residential areas that are connected to the grid network. These technologies use various energy sources and battery systems that are interconnected to make up for the failure of any connected distribution line. Their operational advantages and economic feasibility have attracted investments from governments and therefore the market for these is expected to rise in the coming years, which in turn acts as an opportunity for lead-acid battery installations.
Increasing Penetration of Renewable Energy Sources in Power Generation to Boost the Market
The increasing demand to reduce greenhouse gas (GHG) emissions has surged renewable energy usage in countries exponentially in recent years and is expected to increase in the coming years as well. This in turn will lead to the expansion of the market of Lead Acid Battery for Energy Storage and thus stoke the adoption of lead-acid batteries. For instance, in 2019, Germany declared a new goal to produce 20GW energy by using offshore wind power by end of 2030, attracting investments for developing energy storage systems in the country and driving the market.
Economical Advantage and Preference Over Other Types in Specific Applications Will Drive Lead Acid Battery Installations
The manufacturing cost of the lead-acid batteries is low as compared to the other counterparts available in the market, which make them a good fit for heavy-duty installations. The other operating advantages of these batteries include high operating voltage, high energy density, rechargeability, wide operating temperature range, and convenience in large storage systems, peak load shaving and valley clipping. Also, they are preferred for applications that are used once in a long period such as off-grid solar installations, uninterruptible power supply (UPS) systems, hospital equipment, wheelchairs, forklifts, and others.
Rising Adoption of Lithium-on Batteries Imposes a Major Threat to the Market
The key restraint for the overall lead-acid battery industry has been the replacement of these batteries by lithium-ion batteries in several applications in the energy sector owing to their high energy density. Over the last decade, the share of lithium-ion batteries in the energy storage systems market has increased at an exponential rate. Currently, these batteries account for more than 3/4th of the energy storage systems market. Further, the presence and introduction of other battery technologies in the market such as nickel-cadmium, nickel-metal hydride, lithium-ion polymer, and others, which have been proven effective for some specific applications, are also expected to hamper the growth of the market for lead-acid battery for energy storage.
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Increasing Battery Installations by Service Providers Will Surge the Demand for Utility-Owned Type
Based on type, the lead-acid battery for ESS market is segmented into the utility-owned, custom owned, and third party owned. A major portion of battery installations is carried out by the utility companies to meet the electricity demand and support the evolution of new systems. Some of the new systems such as DEG and VPP require battery installations by utility companies to conserve excess power from homes and power plants. Looking at the current trend in the battery storage market, the custom owned and third-party-owned segment is expected to witness a healthy growth. The catalyst to these would be collaborations between government and private entities for energy storage technologies projects and an increasing number of individual battery storage systems at residential locations.
Construction of New Micro Grids with Solar and Wind Installations to Fuel the Market
In terms of application, the market for Lead Acid Battery for Energy Storage is segmented into micro-grid, household, industrial, and military. Microgrids are currently having the maximum number of battery installations following increased solar and wind energy installations in various countries. The energy generated from solar and wind farms is stored at these locations and then distributed to different locations thereon. The support and funds by governments for solar and wind installations are expected to rise steadily in the coming years, which will further drive the growth of the microgrid segment.
Asia Pacific Lead Acid Battery for Energy Storage Market Size, 2019 (USD Billion)
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The market size in Asia Pacific stood at USD 3.12 billion in 2019. The demand for continuous power has increased in developing countries such as China and India, which is driving the battery storage system installations. Also, the recent introduction of virtual power plants in countries such as Australia, New Zealand, Japan, and South Korea is creating multiple growth opportunities for lead-acid battery installations, which is further strengthening the region’s hold on the lead acid battery for energy storage market share.
In Europe, the major factors driving the market for Lead Acid Battery for Energy Storage are the green energy targets set by various countries and the European Union. This will drive the adoption of renewables and by extension, battery storage systems. For instance, in 2020 the UK has shut down all its coal power plants in operation in a bid to reduce the carbon emissions.
In the US, the government has invested heavily in virtual power plants and renewable energy projects, which have helped the battery storage market to grow.
The Middle East & Africa and Latin America regions are expected to attract significant investments for battery storage systems along with the rising installations of renewable sources in the near future.
Enersys, Exide Technologies, Narada, and Amara Raja Are Among the Leading Players in the Market
The competitive landscape of the lead-acid battery for energy storage market depicts a market dominated by battery manufacturers such as Enersys and Exide Technologies. These companies have a strong regional presence along with wide customer reach and established brand names all across the globe. North America, Asia Pacific, and Europe are the major revenue generating regions for all the companies operating in the market. The market also includes other players such as Guangdong JIYI General Corporation, GSYuasa, and others who have a well-established market in their operating regions and are working on expanding their businesses in other regions. This is expected to lead towards a competitive market for battery sales in the coming years, according to this market analysis.
An Infographic Representation of Lead Acid Battery for Energy Storage Market
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The lead acid battery for energy storage market report provides a detailed analysis of the market and focuses on key aspects such as leading companies, product types, and leading applications of the product. Besides this, the report offers market insights into the market trends and highlights key industry developments. In addition to the aforementioned factors, the report encompasses several factors that have contributed to the growth of the market over the recent years.
Value (USD Billion) and Volume (Million kVah)
Fortune Business Insights says that the global lead acid battery for energy storage market size was USD 7.36 billion in 2019 and is projected to reach USD 9.73 billion by 2027.
In 2019, the lead acid battery for energy storage market value stood at USD 7.36 billion.
Growing at a CAGR of 3.6%, the lead acid battery for energy storage market will exhibit healthy growth in the forecast period (2020-2027).
Utility-owned is expected to be the leading segment in this market during the forecast period.
Increasing adoption of renewable and battery storage is fueling the demand for lead acid batteries and driving the market.
Enersys, Exide Technologies, Narada, and Amara Raja, are among the leading players in the global market.
Asia Pacific dominated the global market share in 2019.
The introduction of DEG (Distributed Energy Generation) and VPP (Virtual Power Plant) will drive the adoption of energy storage systems.
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