Half cost ESSs and grid-scale systems to dominate industry, BNEF predicts

Half cost ESSs and grid-scale systems to dominate industry, BNEF predicts

Half cost ESSs and grid-scale systems to dominate industry, BNEF predicts 311 311 Energy Storage Journal


November 15, 2019: Grid-scale energy storage deployment will dominate the industry’s market for at least the next decade, paving the way for a $1 trillion industry, claim analysts from Bloomberg New Energy Finance.

Bloomberg has more than doubled its 12-year forecast from last year’s report, with the latest prediction suggesting there will be around 284GW/767GWh of installed capacity by 2030.

The claims comes in the latest annual forecast from research company Bloomberg NEF’s Long-Term Energy Storage Outlook, launched on November 6.

The report estimates fully integrated system costs will fall from an average $357/kWh (fully-installed system for a 20MW/80MWh AC system) to $170/kWh by 2030.

The report also predicts the global energy storage market (except pumped hydro) will grow to a cumulative 942GW/2,857GWh over the next 22 years.

This growth, which the report states will attract $1.2 trillion in investment, will see energy storage supplying 7% of total installed capacity up to 2040 — the rest to be made up of hydro, gas, nuclear, coal, wind, solar and others with a smaller share.

Logan Goldie-Scot (pictured), head of energy storage at BNEF, said the majority of storage capacity would be utility-scale until the mid-2030s, when behind-the-meter applications would overtake.

A BNEF spokesman told ESJ that when looking at the application mix of ESSs deployed for grid-scale applications they expected ancillary services, peak shaving, energy shifting, transmission and distribution to have a greater proportion of the total build up to 2035.

They said: “Behind the meter adoption is for the residential, commercial and industrial segments and are driven by retail economics, how much customers pay for energy and how much value there is to change their consumption profile by using batteries, rather than bulk power/wholesale economics.

“The drivers for behind the meter adoption post-2035 are the same as pre-2035 — residential customers will increasingly install batteries to increase self-supply of solar generation, commercial and industrial customers will use batteries to also increase self-supply of solar generation as well as reduce peak demand — but we expect the rate of uptake to increase to overtake grid-scale in 2035.”

Behind the meter installations will be sited at business and industrial premises, and at residential properties delivering a variety of services including peak shifting, storing excess solar output and improving security-of-supply.

China, the US, India, Japan, Germany, France, Australia, South Korea and the UK will be the leading countries and represent two thirds of the installed capacity by 2040, claims the report.

In the near-term, South Korea will dominate the market, with the US set take over in the early 2020s, which in turn will be overtaken by China in the 2020s. China will then lead through to 2040.

Yayoi Sekine, energy storage analyst for BloombergNEF and co-author of the report, said: “We have become much more bullish about storage deployments since our last forecast a year ago. This is partly due to faster-than-expected falls in storage system costs, and partly to a greater focus on two emerging applications for the technology – electric vehicle charging, and energy access in remote regions.”