Automotive Market on Track to Be Biggest User of Energy Storage

July 16, 2014 By Karen Henry

Lux-research-energy-manageThe automotive market is on its way to displacing consumer electronics as the biggest user of energy storage, according to a new report from Lux Research, “Finding Growth Opportunities in the $50 Billion Energy Storage Market.”

Energy storage will grow at a compound annual growth rate (CAGR) of 8 percent to $50 billion in 2020, Lux reports.

Transportation applications will outpace electronics growth—attaining an 11 percent CAGR to become a $21 billion market by the end of the decade. Its faster growth will close the gap with electronics, which will remain the single largest market valued at $27 billion. The market for stationary applications will be worth $2.8 billion.

Additionally, incremental evolutions like start-stop technology are leading to significant changes in the energy storage market. With global sales of 59 million, a 53 percent market share and $6.1 billion in annual revenue, micro-hybrids will overtake the conventional internal combustion engine and emerge the most popular drivetrain by 2020.

Through its evaluation, Lux identified the following growth opportunities and shifts in the energy storage market:

  • Electric vehicles (EV) are the largest growth opportunity in transportation. With modest sales of 440,000 units, electric vehicles still will use $6.3 billion worth of energy storage. The United States will lead EV sales for most of the decade, peaking at 167,000 units in 2019 before expiring subsidies dampen sales. That will help China nearly catch up with the United Sates in 2020—attaining sales of 145,000, versus 148,000 in the United States.
  • Smartphones are the leader in electronics. The popularity of smartphones and subsequent increases in battery capacity will see this market segment growing at a 12 percent CAGR to $8.4 billion in 2020. Tablet computers follow with a 6 percent CAGR to $12 billion, the single largest energy storage consumption by a single application.
  • Driven by solar integration, residential represents the biggest opportunity in stationary energy storage applications—leaping from less than $0.1 billion to $1.2 billion in 2020. UPS and backup applications provide the next largest opportunity, with $0.7 billion in 2020 revenues, while renewables shifting at the utility level with $0.3 billion, rounds out the top three.

Earlier this year, Forbes reported that the energy storage market should experience a boom in the next few years.

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