Global Battery Energy Storage Systems Market Overview
The battery energy storage systems (BESS) are primarily employed to decrease peak demand charges, integrate renewable sources, regulate voltage and frequency, and provide a backup power supply. Battery energy storage systems store the electricity generated by power plants. This electricity is then utilized to ensure smooth supply to consumers when power generation from renewable power plants fluctuates due to environmental changes. An old electric grid is an incapable system that wastes considerable amounts of the electricity it produces due to a disconnect between the amount of energy consumers need and energy generated from generation sources. Installing BESS help defer or circumvent the need for new grid investments by meeting peak demand with energy stored from lower-demand periods, thereby reducing congestion and improving overall transmission and distribution asset utilization. The deployment of battery energy storage systems is increasing in power systems across the world. Globally, two factors are accelerating the demand-side response: The need for backup power and a rapid decline in battery energy storage system prices.
According to Value Market Research, the global battery energy storage systems market size was valued at about USD 5.2 billion in 2020 and is estimated to grow at a CAGR of around 28 % during the forecast period 2021 to 2027.
Additionally, the development of electric vehicles (EVs), the deployment of distributed renewable energy generation, and the development of smart grids also pave market growth. Furthermore, advances in digital technologies, such as artificial intelligence, blockchain, and predictive analytics, give rise to aggregated solutions and innovative business models. Start-ups worldwide are rapidly commercializing intelligent networks of “behind-the-meter” (BTM) batteries to benefit electricity customers, utilities, and grid operators. Whereas an increasing focuses on rural electrification worldwide, large storage requirements in data centers are expected to offer projection opportunities to the market.
Until lately, high costs and low round trip efficiencies prevented the mass deployment of battery energy storage systems. But, the advent of lithium-ion batteries has overcome these issues. However, factors like high capital investment required for the deployment and lack of vendors' availability and project financing are restraining the market growth.
The global battery energy storage systems market is moderately dense. LG Chem., ABB, The AES Corporation, Enerbrax Acumuladores Ltda, Beacon Power, LLC, BYD Company Limited, Alevo Group, Convergent Energy + Power, Greensmith Energy Management Systems, SMA Solar Technology AG, Exide Industries Ltd. are key players associated with the market.
In this research report, the Battery Energy Storage Systems market is segmented by battery technology, application, and region.
Analysis, By Battery Technology
Based on battery technology, the global battery energy storage systems market is segmented into lithium-ion batteries, sodium-sulfur batteries, lead-acid batteries, flow batteries, and others. Among these, lithium-ion batteries dominated the market, followed by lead-acid batteries and flow batteries. Lithium-ion batteries acquired almost half of the global market share. Lithium-ion batteries are most widely adopted due to their lightweight, longest life, more usable capacity, constant power, temperature tolerance, fast & safe charging, and availability in standard industry sizes. The low cost and high efficiency of lithium-ion batteries have been influential in a wave of BESS deployments in recent years for both small-scale, grid-level deployments and behind-the-meter installations and large-scale.
Analysis, By Application
Based on application, the global battery energy storage systems market is segmented into residential, non-residential, utilities, and others. Utilities application accounted for the maximum market share in 2020. Booming energy requirement, expanding transmission and distribution (T&D) lines, growing installation of high-performing technology into the grid system, rising construction of advanced metering infrastructure, and increased complexity of maintaining system reliability drive the utility segment growth. In utility applications, the battery storage system is used to maintain the flow of electricity from the power plant to end-users, such as frequency regulation, renewable integration, peak shaving, microgrids, and black start capability.
Analysis, By Region
Based on region, the market is divided into North America, Europe, Asia Pacific, Latin America, and the Middle East and Africa. The Asia Pacific occupied the largest share of the battery energy storage system market in 2020, with China, Japan, South Korea, and Australia propelling the regional market. The region is stepping towards gaining half share in a global market. Rising initiatives to improve the reliability and quality of the power distribution facilities for the residential customers, specific plans for electrification in remote areas, and penetration of renewable energy. The region is witnessing increased investment for electricity generation and storage due to the proposal to increase the usage of electric vehicles. Europe is another lucrative region or BESS. Europe will witness an increase in sustainable energy demand and a rise in renewable energy technology deployment. Renewables are becoming a strength of the power sector in Europe.
Market Segmentation covered in the Report:
By Battery Technology
- Lithium-Ion Batteries
- Sodium–Sulfur Batteries
- Lead-Acid Batteries
- Flow Batteries
- North America
- Asia Pacific
- Latin America
- Middle East and Africa
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