Advanced energy storage encompasses technologies designed for stationary energy storage applications, including grid energy storage as well as industrial and commercial applications. Lithium-ion batteries dominate the advanced energy storage market owing to their high energy density, low self-discharge, and minimal maintenance requirements. They find extensive usage for stationary energy storage applications in industries, buildings, and utility-scale projects. The global advanced energy storage market is estimated to be valued at US$ 16.9 billion in 2024 and is expected to exhibit a CAGR of 5.6% over the forecast period of 2024 to 2031.
Key Takeaways
Key players operating in the advanced energy storage market are ABB Ltd., LG Chem, Ltd., Samsung SDI Co., Ltd, General Electric Company, and Tesla Inc. These players are focusing on developing innovative and cost-effective lithium-ion battery solutions to gain a competitive edge in the market.
The growing deployment of renewable energy across the world is presenting significant opportunities for advanced energy storage systems. Countries are adopting energy storage technologies to ensure grid flexibility and reliability with increasing shares of intermittent renewable sources like solar and wind. Technological advancements in battery chemistries, such as solid-state lithium batteries, are further enhancing the capabilities of energy storage solutions.
Market drivers
Increasing investments in grid infrastructure modernization are a key driver for the advanced energy storage market. Modernizing aging grid infrastructure with battery energy storage improves power reliability and resilience against outages. Energy storage helps in integrating renewable energy by addressing issues related to intermittency. It plays a vital role in facilitating the transition to a sustainable, clean, and flexible energy system. Supportive government policies and regulation providing incentives for energy storage deployment will continue to boost the market over the coming years.
Current challenges in Advanced Energy Storage Market
The advanced energy storage market is witnessing numerous technological advancements. However, there are certain challenges that are hindering the growth of this market. One major challenge is the high initial investment required for the development of advanced energy storage systems. These systems involve the use of expensive batteries and other electrical components. This increases the overall costs and makes these storage solutions unattractive for commercial and residential sectors. Another issue is the limited lifetime of batteries. Frequent replacement of batteries increases the maintenance costs over time. Developing durable and long-lasting batteries is crucial to address this challenge. Standardization of technologies is also missing in this market. This leads to integration issues and incompatibility between products of different manufacturers. Lack of common standards poses difficulties in large-scale deployment of advanced storage projects.
SWOT Analysis
- Strength: Advanced battery technologies offer higher energy density and efficiency. These energy storage systems provide clean and reliable source of power.
- Weakness: High R&D costs involved in developing new energy storage technologies. Issues related to limited lifetime and degradation of battery performance over time.
- Opportunity: Growing demand for integrating renewable energy with electric grids will drive the demand for energy storage solutions. Increasing focus on developing microgrids and off-grid applications offers new growth avenues.
- Threats: Slow adoption rate due to high upfront capital costs. Strict regulatory procedures delay commercialization of new technologies. Intense competition from low-cost alternativessuch as pumped hydro storage.
Geographical Regions
North America dominates the global advanced energy storage market and accounts for over 30% of the total market share, in terms of value. U.S. is one of the major markets owing to rising investments in grid infrastructure modernization and energy storage projects by utilities.
Asia Pacific is expected to be the fastest growing regional market during the forecast period. Rapid economic development, growing electric grid requirements, and supportive government policies are driving the demand for advanced storage in countries such as China and India. Declining battery prices and focus on developing home energy systems will further aid the market expansion.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
