Energy storage market surges 243% to new record
Led by deployment in the PJM wholesale utility market and residential installments in California and Hawaii, the industry deployed 112 megawatts of energy storage capacity in the fourth quarter of 2015 alone. That was higher than all deployments in the previous two years combined, according to the report. The technology is considered key for deploying more renewables, as well as allowing more backup power for utilities during blackouts and other grid challenges.
“We can look back at 2015 as the year when energy storage really took off,” said Ravi Manghani, a GTM Research senior energy storage analyst and the report’s author, in a statement. “While most of the growth was limited to a single wholesale market of PJM, we expect growing interest for storage in several markets.”
In an email, Manghani said more market access was a key factor behind the growth. The number of states with specific policies on storage has doubled in two years, for example. Also, with the makeup of the grid changing rapidly, “more renewables are coming on board, a big portion of which are distributed. Energy storage will have an important role in enabling this modern, more distributed, cleaner grid,” he said.
In total, 221 megawatts of energy storage capacity came online last year. The market could hit the 1 gigawatt threshold by 2019, GTM Research said. Costs are expected to continue falling, as well, with prices for installed utility projects falling 29 percent in comparison to 2015, the report said. The recent extensions of federal tax credits for renewables should help the market as more storage is paired with wind and solar, it said.
The report considered three segments of the market: residential, nonresidential and utilities. It said the utility space remains the “bedrock” of energy storage, making up 85 percent of deployments last year. However, the behind-the-meter market, or residential and nonresidential sectors, are experiencing rapid growth, jumping 405 percent in 2015.
The sector also is a focus of the Department of Energy’s Advanced Research Projects Agency-Energy, which released a list last week of which of its projects are finding private-sector investment. Many of those involve advancements in energy storage technology, including several projects for new battery designs that led to the formation of new companies.
Click here to read the report.