Cost falls and EVs to push battery storage market to USD-620bn growth
Image by: BloombergNEF.
The global battery storage market is flourishing and cumulative installations are expected to reach 942 GW by 2040, excluding pumped storage hydropower, according to Bloomberg New Energy Finance (BNEF).
The research group estimates that the market will attract around USD 620 billion (EUR 546.8bn) in investments in the next 22 years, driven by the falling cost of batteries, both in the electric vehicle (EV) and electricity segments. In its latest annual forecast, BNEF said that the capital cost of a utility-scale lithium-ion energy storage facility will drop by 52% between 2018 and 2030. The falls are faster than BNEF analysts’ expected and are also the result of the greater focus on EV charging and projects providing energy access in remote areas, explained analyst Yayoi Sekine.
As battery storage deployments rise, BNEF expects that energy storage will become an alternative to new power generation facilities or network improvement, in some areas. Behind-the-metre systems are even seen as a “viable” alternative to utility-scale installations, while this will be a time-consuming process due to the lack of the needed regulatory frameworks in some countries.
“We see energy storage growing to a point where it is equivalent to 7% of the total installed power capacity globally in 2040. The majority of storage capacity will be utility-scale until the mid-2030s, when behind-the-metre applications overtake,” said Logan Goldie-Scot, head of energy storage at BNEF.
In geographical terms, there will be nine markets that will lead the global battery market, having two-thirds of the overall installed capacity by 2040. Those will be China, the US, India, Japan, Germany, France, Australia, South Korea and the UK. The market leader by 2020 will be South Korea, but China is anticipated to take its crown and lead throughout to 2040.
Veselina Petrova is one of Renewables Now's most experienced green energy writers. For several years she has been keeping track of game-changing events both large and small projects and across the globe.