Key findings for near-term U.S. energy storage market growth
This author no longer works for DNV GL.
The U.S. energy storage market is strong and robust yet still developing as technology and policy continue to evolve. The market has large potential for growth; opportunity abounds. Continuous development of initiatives that reduce costs and increase experience is necessary for the market to meet growth expectations.
Through our evaluation, we determined that growth of the U.S. grid energy storage market could reach between two and four gigawatts during the next five years, pending availability of financial incentives. Here is a summary of our key findings for the U.S. energy storage market.
Many new energy storage technologies are in development and a handful of technologies are ready for commercialization.
> Mature energy storage technologies—thermal energy storage, pumped hydropower, and compressed air energy storage—constitute the majority of the energy storage market, today.
> In the near term, battery technologies and thermal storage are expected to be the strongest growth areas.
> Second-generation technologies are emerging and research continues to be fruitful.
> Venture capital investment in storage technologies is booming both inside and outside of the United States.
> The ability to scale energy storage technologies quickly is a challenge, as is the ability to bring down costs.
> Financial incentives could have a great impact on market size during the next five years by defraying initial investment costs to help grow the market.
Energy storage application markets in the United States are still evolving.
> Policy developments continue to shape markets for energy storage applications.
> Demonstrations continue to define grid application success and inform technology value propositions.
> Markets around some grid storage applications, such as ancillary services, are expanding now.
> Markets for applications in development now, such as peaker plant applications, will likely come to fruition after five years.
> In the next five years, grid storage application costs are expected to decrease through improved system integration, increased production, and enhanced distribution capability; investments are expected to continue; and some application areas currently in the demonstration phase will likely start to commercialize.
Estimated current installed capacity by application (MW)
Download the full report for the CDA: Market Evaluation for Energy Storage in the United States.
What is your expectation for energy storage market growth during the next five years? What factors will influence this most?