Strong growth ahead for storage

Annual battery storage installations will exceed 10 GW/28 GWh in 2021, following a particularly strong year in 2020, despite the challenges created by the global pandemic. Combined solar and storage will be a core focus for new deployment in 2021, as the front-of-the-meter and behind-the-meter energy storage markets are both expected to grow significantly in the months ahead.

The first energy storage project above 100 MW came in 2017. It took another three years for both the 200 MW and 300 MW barriers to be broken. Projects in the order of 400 MW and above have been announced and are likely to be in operation before the end of 2025. Project sizes are increasing because they are inversely proportional to system prices, which have continued to decrease, making larger projects more economically feasible.

In 2021, the United States is forecast to account for 50% of the global market, following a threefold increase from 2020, as energy storage project owners take advantage of the federal solar investment tax credit (ITC). In Europe, a 70% increase in annual installations will be realized in 2021, driven by new frequency response, capacity market, and renewables co-location opportunities.