According to recent research from Navigant, annual revenue for the energy storage and renewable integration sector will exceed $23 billion by 2026. Utility-scale and behind-the-meter applications are likely to experience the strongest growth.
The report states that the costs to develop new renewable energy projects continue to drop around the globe while policy incentives, target capacity mandates, and resilience demand for behind-the-meter (BTM) customers continue to increase. As a result, capacity for wind and solar PV continue to rise in all regions and market segments — from small residential systems to utility-scale systems. While this prospect is exciting in terms of global sustainability and greenhouse gas reductions, the large-scale addition of these variable forms of generation presents challenges to an electrical grid and industry that is slow to keep up with modern technology.
Navigant says these challenges vary depending on the dynamics of the local grid, interconnection regulations, and the generation source. Energy storage systems (ESSs) can help mitigate potential grid concerns and integrate renewable energy resources without affecting grid reliability. The argument for energy storage for renewables integration (ESRI) relies on several different factors, including the condition of the local grid, the type and amount of renewable generation, and incentives and subsidies, among others. The lack of consistency among regions and even countries within the same region proves to be another barrier to the deployment of ESSs as developers struggle to create standardized systems and financing options that are deployable on a large scale. Additionally, declining costs of renewable generation, solar PV especially, are creating unique challenges for the energy storage market.
As more proof of the growth in the energy storage market, grants totaling $20 million were awarded last month to 26 Massachusetts-based projects that will help develop the state’s energy storage market. The programs are positioned to deliver benefits to the Massachusetts’s ratepayers and the electrical grid. The awarded projects will benefit 25 communities and draw in $32 million in matching funds, helping to grow the Commonwealth’s energy storage economy.
Also in December, New York Governor Andrew Cuomo signed a bill to create a statewide energy storage target, making New York the fourth state in the country that will have such a target. The bill to establish an energy storage deployment program was passed unanimously by the legislature five months ago. Under the new law, the New York Public Service Commission had until January 1, 2018 to determine a target level for 2030 and decide whether it will be mandatory.
Mark your calendars: The 3rd Annual Environmental Leader & Energy Manager Conference takes place May 15 – 17, 2018 in Denver. Learn more here.