Installed Energy Storage for the Grid to Be 20.8 GW by 2024

September 17, 2014 By Karen Henry

ESGAS-energy-manageGlobal installed energy storage for the grid and ancillary services (ESGAS) power capacity is expected to grow from 538.4 MW in 2014 to 20.8 GW in 2024, according to a new report from Navigant Research, Energy Storage for the Grid and Ancillary Services. Although the ESGAS market is developing in a piecemeal fashion, several factors, including an anticipated rise in natural gas prices, are converging to facilitate market growth. Navigant’s report forecasts the market opportunity for nine of the ten applications for energy storage situated on the utility side of the meter for 2014–2014.

The majority of opportunities for energy storage will be in capacity-based applications, including spinning reserve and grid asset optimization. Because natural gas prices are expected to go up, key markets such as Europe are discussing how to structure capacity markets. With over 1,300 MW of storage in the pipeline in North America alone, financing will be a key area of focus and pressure for the industry during the next 12 months. Securing access to reasonably priced project financing will be imperative for the market to grow over the next three years.

Pumped storage and advanced lithium ion batteries currently lead the ESGAS market with 219.2 MW and 117.8 MW of installed capacity, respectively. These technologies are followed by other advanced battery chemistries such as advanced lead-acid, sodium sulfur (NaS) batteries, advanced flow batteries and sodium metal halide. Compressed air energy storage (CAES) is forecast to come online with 34.2 MW in 2014, and about 14.4 MW of flywheels are also expected to be commissioned that year. Power-to-gas is expected to grow the fastest over the forecast period, but all technologies will experience high growth in the first half of the forecast period, thanks to a low installed base.

Nearly 35 percent of the 79,357.8 MW forecasted to be installed over the 2014–2024 time is projected to go to advanced lithium ion technology because of its compact footprint, competitive pricing, and investment in materials, manufacturing and other innovations. Pumped storage and advanced lead-acid are expected to follow with 14.1 percent and 10.6 percent of the market, respectively.

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