Battery Energy Storage Market Trends

Growth Drivers

• Reduced Emissions - Battery energy storage systems contribute to reduced greenhouse gas emissions by enabling greater integration of renewable energy sources and reducing the need for fossil fuel-based peaking power plants. To meet the goal of reducing greenhouse gas emissions by 55% by 2030, batteries are the fastest-growing storage technology.
• Government Policies - Many governments around the world are implementing policies and incentives to promote the transition to clean energy sources and reduce greenhouse gas emissions. Battery energy storage is often a key component of these initiatives, further driving market growth
• Technological Advancements- The developments in battery technology are leading to improvements in energy density, cycle life, security, and cost-effectiveness. As batteries become more efficient and affordable, adopting energy storage systems is likely to accelerate the market for battery energy storage. In research conducted by our analysts, over the next five years, capacity for energy storage worldwide is expected to grow by 55 % and reach 260 GW in 2026.

Challenges

• High Cost of Integration -Battery energy storage systems can be expensive to install, with the cost of batteries being a significant portion of the overall system cost. While costs have been decreasing over the years, further reductions are needed to make these systems more economically viable, especially for large-scale applications
• Limited Energy Density
• Lack of Standardization