Grid-scale Battery Market to grow at a CAGR of 20.88% during 2024-2028
The Grid-scale Battery Market is expected to grow at a CAGR of 20.88% during 2023 and 2028. During this period, the market is also expected to show a growth of USD 12247.48 million. In the energy storage sector, batteries have emerged as a preferred solution for various applications worldwide, driven by the increasing adoption of Energy Storage Systems (ESSs). The decline in battery prices is a significant factor fueling this trend. Since 2010, the cost of battery systems, including lead-acid and lithium-ion, has reduced substantially due to advancements in hardware technology, economies of scale, and standardization of design and engineering. During the forecast period, these cost reductions are expected to continue, with lead-acid and lithium-ion battery prices dropping by half, and flow battery prices decreasing by one-third compared to current levels. This price decline, coupled with the growing demand for ESSs, is set to boost the sales of battery systems in the grid-scale market.
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Technavio analysts predict that the Ancillary services subsegment will lead the Application segment during 2024 and 2028 Grid-scale batteries have become essential assets for providing ancillary services to maintain the stability and reliability of the electric grid. Ancillary services refer to the range of support functions necessary to manage electricity supply-demand imbalances, ensure frequency and voltage stability, and enhance grid resilience. Grid-scale batteries offer flexibility in responding to grid demand fluctuations by either absorbing excess electricity or supplying additional power as required. A prime example of ancillary services provided by grid-scale batteries is frequency regulation. Frequency, which denotes the number of AC cycles completed in a second, must be maintained within a narrow range for grid stability. Grid-scale batteries, with their rapid response capabilities, are ideal for providing frequency regulation services, making them indispensable components of modern power grids.
Here are the various ways based on which the market is segmented:
There are several factors that are causing the market to flourish growing demand for esss from utilities
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The Battery storage market is experiencing significant growth due to the increasing integration of renewable energy into the power grid. With the intermittency of solar and wind energy, battery storage plays a crucial role in overall grid stability by storing excess energy during peak production hours and releasing it during peak demand periods. Incentives from governments and utilities are driving the expansion of battery storage deployment. The highest market share is held by lithium-ion batteries due to their high energy density and efficiency. However, other types of batteries, such as nickel-iron, nickel metal-hydride, nickel-cadmium, sodium-based flow, lead acid, and other lightweight batteries, also have their applications based on their specific weight, efficiency, and life expectancy. The ownership model of battery storage is shifting from utility-owned to third-party owned, allowing for more flexible and decentralized energy storage solutions. Regulations and technological advancements are key factors driving the expanded deployment of battery storage. The forecast period for the battery storage market is expected to see continued growth, with a focus on reducing standby losses and increasing energy efficiency. Nickel-based batteries, such as nickel-iron and nickel metal-hydride, have a longer life expectancy compared to other batteries but may have higher standby losses. Sodium-based flow batteries and lead acid batteries have lower standby losses but may have lower energy efficiency. Lithium-ion batteries offer a balance between the two. Regulations and technological advancements are crucial for the growth of the battery storage market. Governments and utilities are implementing policies to incentivize the deployment of battery storage, while technological advancements are improving the efficiency and reducing the cost of battery storage solutions. In conclusion, the battery storage market is a crucial component of the renewable energy sector, providing grid stability and energy storage solutions for intermittent renewable energy sources. The ownership model is shifting towards third-party ownership, and technological advancements and regulations are driving the growth of the market. The choice of battery technology depends on specific requirements, such as weight, efficiency, and life expectancy. The future of the battery storage market looks promising, with continued growth and innovation expected in the coming years.
According to Technavio, the global grid-scale battery market is a segment of the larger independent power and renewable electricity market, which encompasses businesses involved in the generation and distribution of electricity derived from renewable sources. This market comprises independent power producers, gas and power marketing and trading specialists, integrated energy merchants, and renewable electricity providers, as well as manufacturers of raw materials and equipment for the solar power industry. The expansion of the global renewable electricity market is anticipated to be fueled by governmental initiatives and ambitious targets promoting the adoption of renewable power.
The Grid-scale Battery Market is experiencing significant growth, fueled by the growing demand for esss from utilities. Industries are leveraging the products belonging to the market for customer engagement, transactional notifications, and promotional offers.
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