New York, Aug. 02, 2023 (GLOBE NEWSWIRE) -- The global grid scale battery market size is predicted to grow at a CAGR of over ~32% from 2023 to 2035. The market is projected to garner a revenue of USD 106 billion by the end of 2035, up from a revenue of ~USD 5 billion in the year 2022. The market growth is attributed to increasing investments in renewable energy and the low cost of grid batteries in the coming years. The scarcity of renewable energy sources around the world and rising electricity consumption with increasing population are expected to drive the growth of the market. Global electricity consumption increased by more than 25,000 terawatt hours in 2021. The increasing number of electronic devices used worldwide also increases the growth of the market.
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The growing population, rapid industrialization and increasing urbanization are expected to drive the market growth in the coming years. The growth of the market is also attributed to the increasing adoption of consumer electronics and the increasing penetration of the internet across the globe. Globally expanding industries that utilize a large number of renewable sources to power heavy machinery and equipment are also expected to have a positive impact on the market growth, according to the market analysis. The increasing development in the industrial sector requires continuous utilization of production facilities that regularly require electricity and a power supply that increases the electricity demand.
Grid Scale Battery Market: Key Takeaways
- Market in Asia Pacific to propel highest growth
- The lithium-ion segment to garner the highest growth
- Market in North America to grow at a highest rate
Rapid Urbanization and Industrial Growth across the Globe to Boost Market Growth
It is estimated that the increasing number of industries worldwide with urbanization and digitalization will drive the market growth in the coming years. The economic standards of many countries are rising day by day and the increase in people's disposable income is likely to drive the growth of the market according to the market analysis. The increasing migration of people from the rural population in search of job opportunities leads to increasing urbanization. It is estimated that more than 50% of the world's population lives in. In 2022, more than 4 billion people lived in cities. Investments in renewable energy technologies in the United States are estimated to reach approximately USD 60 billion in the year 2019. The price of lithium-ion battery cells has fallen by more than 95% over the past three decades since 1991. The price of a one-kilowatt-hour battery was more than USD 7,000, falling to USD 180 globally in 2018. It is estimated that by the end of the year 2050, the world's residential and commercial energy needs will increase by more than more than 10%.
Grid Scale Battery Market: Regional Overview
The global grid scale battery market is segmented into five major regions including North America, Europe, Asia Pacific, Latin America, and the Middle East and Africa region.
Expanding demand for electricity to Drive the Market Growth in Asia Pacific Region
The grid scale battery market in Asia Pacific region is estimated to garner the largest revenue by the end of the year 2035. The growth of the market is mainly attributed to the growing demand for electricity and the rapid urbanization in the region. According to the United Nations Department of Economic and Social Affairs, India and China are expected to have grown by 416 and 255 million urban residents, respectively.
In addition, the expansion of grid capacities in developing countries and the increased use of renewable energies for power generation are expected to accelerate market growth in the region in the coming years. It is estimated that the growing number of sectors that require energy storage units will drive the growth of the market with rising energy and power consumption. The increasing use of backup power supplies in IT industry and other software industries to avoid unwanted program glitches is expected to boost the growth of the market in the coming years.
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Growing Renewable Energy Integration to Propel the Growth in the North America Region
The North America grid scale battery market is estimated to garner the highest CAGR by the end of 2035. As North America continues to transition toward cleaner and greener energy sources, the integration of renewable energy into the grid has become a priority. Grid-scale batteries play a crucial role in smoothing out the intermittent nature of renewable sources like solar and wind power. According to a report by the U.S. Energy Information Administration (EIA), the share of renewable energy in the United States' electricity generation mix had grown to 20.6% in 2020. This trend is likely to continue, leading to an increased demand for grid-scale batteries to store and manage renewable energy generation. Grid-scale batteries help enhance the stability and resilience of power grids by providing frequency regulation and voltage control. They act as a buffer during times of peak demand, reducing strain on the grid and preventing blackouts or brownouts.
Further, government incentives, subsidies, and supportive policies have encouraged the adoption of energy storage technologies, including grid-scale batteries. Various state and federal programs offer financial assistance or tax credits to companies investing in energy storage projects. The cost of battery technologies, especially lithium-ion batteries, has been steadily declining in recent years due to technological advancements, economies of scale, and increased manufacturing efficiency.
Grid Scale Battery, Segmentation by Type
- Lithium-Ion
- Lead Acid
- Flow Battery
- Sodium-Based
Amongst these segments, the lithium-ion segment is anticipated to hold the largest share over the forecast period. The integration of renewable energy sources, such as solar and wind, into power grids necessitates effective energy storage solutions. Lithium-ion batteries are well-suited for this purpose, as they can store excess energy generated during periods of high renewable output and release it when demand is high or renewable generation is low. A report revealed that lithium-ion battery installations in utility-scale storage applications grew by 142% in 2020, underlining the increasing role of these batteries in supporting renewable energy integration. The rapid rise in the popularity of electric vehicles is one of the primary drivers for the lithium-ion battery market. As countries strive to reduce greenhouse gas emissions and combat climate change, there has been a significant shift toward electric mobility. Lithium-ion batteries are the preferred choice for electric vehicles due to their high energy density, lightweight, and long-lasting characteristics.
The widespread adoption of consumer electronics and portable devices like smartphones, laptops, tablets, and wearable gadgets has driven the demand for compact, lightweight, and high-performance batteries. Lithium-ion batteries have become the standard choice for these devices due to their superior energy density and rechargeability. Advances in lithium-ion battery technology, coupled with increasing manufacturing scale and efficiency, have resulted in significant cost reductions. As battery costs continue to decline, they become more competitive with other energy storage options.
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Grid Scale Battery, Segmentation by Application
- Frequency Regulation
- Peak Shaving
- Bill Management
- Load Shifting
- Renewable Integration
- Others
Amongst these segments, the renewable integration segment is anticipated to hold a significant share over the forecast period. Climate change and its adverse impacts have prompted governments, businesses, and communities worldwide to take action to reduce greenhouse gas emissions. The adoption of renewable energy sources, such as solar, wind, hydro, and geothermal, helps to displace fossil fuel-based electricity generation and lower carbon dioxide emissions. According to the Global Trends in Renewable Energy Investment 2021 report by the United Nations Environment Programme (UNEP), the share of renewable energy in global electricity generation reached 29.3% in 2019, significantly contributing to reducing carbon emissions.
Technological advancements in renewable energy have improved the efficiency, reliability, and cost-effectiveness of renewable sources. Innovations in solar panel technology, wind turbine design, and energy storage systems have made renewable energy sources more viable and attractive for integration into the grid. Many governments have implemented supportive policies, incentives, and regulations to promote renewable energy integration. These measures may include feed-in tariffs, tax credits, renewable portfolio standards, and green energy procurement programs.
Few of the well-known market leaders in the global grid scale battery market that are profiled by Research Nester are Panasonic Corporation, LG Chem Ltd., Samsung SDI Co. Ltd, BYD Co. Ltd, Contemporary Amperex Technology Co Ltd, Tesla, Inc., ABB, Ltd., General Electric Company, Toshiba Corporation, NGK Insulators, Ltd., and other key market players.
Recent Development in the Market
- ABB Ltd. has developed safe heights for sustainable battery power solutions with the tallest wooden skyscrapers. Electricity comes from renewable sources such as hydroelectric power and wind. Due to the wooden construction, the carbon dioxide emissions released during operation are doubled.
- General Electric Company tripled production capacity of its solar battery and energy storage Power Electronics Systems to 9 GW per year by the end of 2022 to offset the decline in the first six months of the year.
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