Energy Storage Systems Market Size, Share & Trends Analysis Report By Technology (Electrochemical, Electromechanical, Thermal, Pumped Hydro), By Region, And Segment Forecasts, 2020 - 2027

Report Overview

The global energy storage systems market demand was 194,320.5 MW in 2019 and is expected to grow at a compound annual growth rate (CAGR) of 7.9% from 2020 to 2027. Growing demand for uninterrupted and reliable power supply from end-use sectors, such as medical, industrial, marine, telecom, and data centers, is expected to drive the demand for energy storage systems over the forecast period. Demand for continuous power is anticipated to attain exponential growth in the years to come owing to rapid industrialization, infrastructure development, and continuous population growth over the coming years. This trend is expected to positively influence the energy storage industry landscape. Rising consumer awareness regarding energy efficiency in commercial and residential buildings is expected to further promote market growth.

The U.S. government is actively investing in energy storage projects in order to achieve a future with sustainable energy. The Government of the State of New York has established the Battery and Energy Storage Technology (NY-BEST) commercialization and test center in Rochester. The facility encompasses an area of 18,000 sq. ft. and cost approximately USD 23 million.

The facility includes a collaboration of Rensselaer Polytechnic Institute (RPI), Troy, and Cornell University, Ithaca, which pull their resources together for validating various forms of energy storage for the residential and commercial use. The implementation of supportive government environmental policies is estimated to fuel the regional growth of the market.

The growing trend of renewable source-based power generation, along with the increasing need for distributed electricity generation, is anticipated to propel the market growth over the forecast period. Energy storage technologies allow power suppliers to save excess electricity for later use, thereby enhancing the grid reliability and flexibility with respect to electricity generation, transmission, and distribution.  

Technological advancements in energy storage technologies, such as the development of advanced batteries offering fast charging and a wide range of applications, are expected to enhance the penetration rate of such storage technologies. However, the COVID-19 pandemic has severely impacted the market supply chain, thereby hampering the overall growth of the industry.

Technology Insights

The pumped hydro segment accounted for the largest share of 95.7% in 2019 owing to its use in balancing the fluctuating output of intermittent renewable sources and baseload power plants. Ongoing investments in the technology are expected to further fuel the segment growth. For instance, in August 2018, the U.S. government announced USD 9 million in funding for research activities aimed at reducing the costs of pumped hydro systems.

Thermal energy storage, being the major renewable option for electricity generation, occupied a significant market share in 2019. Heat stored by short-term and seasonal thermal energy storage systems helps balance the variations in the production and distribution of renewable electricity in a cost-effective manner. Moreover, it causes no adverse environmental impact and is a sustainable energy source.

The electrochemical segment is anticipated to register the fastest CAGR over the forecast period. The rising adoption of electric and hybrid vehicles, along with increasing government initiatives to promote electric vehicle technology, is among the key factors driving the electrochemical energy storage demand. Moreover, battery energy storage systems integrated with solar PV panels are increasingly used in the residential sector, serving as a secondary source of power supply.

Regional Insights

Asia Pacific dominated the market for energy storage systems in 2019 with a share of 46.5% and is expected to maintain its lead over the forecast period. Growing reliable power demand due to rising population and industrial advancements in major economies, such as China and India, is expected to drive the regional market. The Chinese government is significantly investing in large scale battery energy storage systems, which provide electricity to commercial facilities during peak power demand, thereby reducing the electricity cost for such facilities.

Europe occupied a significant market share in 2019 owing to the growing penetration of renewable energy technologies across the region. The government of Europe has developed a model that stores and distributes the energy as per the density of population in a specific region. This model is widely known as the European model. The federal government of Germany significantly invests in advanced research for the electrical energy storage field, pertaining to the storage field’s use in solar panels utilized for residential purposes.

North America is estimated to witness significant growth over the forecast period, with the U.S. being the major contributor to the regional market growth. The U.S. government is actively investing in renewable energy plants in order to achieve a future with sustainable energy. According to the International Energy Agency (IEA), the U.S. government has levied a multi-year extension on tax credits for renewable energy plants, such as concentrating solar power (CSP) and thermal energy storage stations.

Key Companies & Market Share Insights

Several energy storage equipment manufacturers and service providers adopt strategies, such as new product development, partnerships, agreements, collaborations, and joint ventures, to penetrate the market and cater to the changing technological requirements of different end-users in the region. In addition, the market players invest in R&D activities to enhance their product offerings in the energy storage industry. Some of the prominent players in the energy storage systems market include:

• General Electric Company

• LG Chem

• Hitachi Chemical Co., Ltd.

• Samsung SDI Co., Ltd.

• NEC Energy Solutions

Energy Storage Systems Market Report Scope

Segments Covered in the Report

This report forecasts volume growth at the global, regional, and country levels and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2016 to 2027. For the purpose of this study, Grand View Research has segmented the global energy storage systems market report on the basis of technology and region:

• Technology Outlook (Capacity, MW, 2016 - 2027) 

  • Pumped Hydro

  • Electrochemical Storage

  • Electromechanical Storage

  • Thermal Storage

• Regional Outlook (Capacity, MW, 2016 - 2027)

  • North America

    • The U.S.

    • Canada

    • Mexico

  • Europe

    • France

    • Germany

    • The U.K.

  • Asia Pacific

    • China

    • India

    • Japan

  • Central & South America

    • Argentina

  • Middle East & Africa

    • South Africa