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With market opportunities increasing and costs falling, stationary battery energy storage installations are on the rise. According to BloombergNEF, battery manufacturers are aware of the opportunity, as stationary batteries represent an increasing share of installed capacity.
Although progress has been steady, for many years stationary battery applications have played a secondary role to electric vehicles. During this period, lithium-ion batteries were primarily produced for mobility and consumer applications, with utility- or home-scale battery systems being something of an afterthought.
In 2024, this dynamic changed, with the acceleration of battery deployment attracting the attention of manufacturers, who expanded their operations to battery system integration.
BloombergNEF data confirms this trend. The market analyst concludes that stationary battery installations account for an increasing share of global battery deployment. By 2035, BloombergNEF expects stationary applications to account for 16% of batteries installed worldwide, up from 6% in 2020.
“It was definitely a story like when in the early days of the storage industry that was riding the wave of EV battery. I would definitely say that this year that really changed,” Yayoi Sekine, head of energy storage research at BloombergNEF, tells ESS News .
Sekine says battery manufacturers have realised that the stationary energy storage market is “a big enough sector” to devote significant resources to. He adds that supplying the automotive industry “where there are only a few large car manufacturers” for which manufacturers produce specialised products, is a different proposition to stationary storage markets.
"The products are much more basic. Although there is a lot of competition and attempts at differentiation, it is much more similar to the solar market."
Solar energy manufacturers invest
Given this dynamic, its no surprise that solar manufacturers have been drawn to battery integration. And with utility-scale solar development increasingly going hand-in-hand with commercial-scale batteries, the fit seems to be a good one.
Well-established solar companies like Trina, Jinko, Risen Energy and Canadian Solar have expanded into battery manufacturing this decade. And they are vertically scaling up their battery production.
“They are even announcing cell manufacturing,” says Sekine. “Trina already makes cells, Jinko does too. Canadian Solar just announced that it is going to start up a cell and systems facility in Kentucky.”
While attractive, battery production will offer little respite from the solar industrys aggressive price competition and relentless imperative to cut costs.
BloombergNEF reported last week that cell and battery pack prices would decline by 20% on average worldwide in 2024. The latest analyst statistics show that the cumulative stationary storage park will reach 168 GWh this year, a huge jump from the 96.1 GWh deployed in 2023.
«A lot about batteries in 2025»
In light of these developments, the International Energy Agency (IEA) is raising its expectations for battery energy storage. On LinkedIn, Alessandro Blasi, special advisor to the IEA’s executive director, describes batteries as “the final frontier” and “the next chapter of the energy revolution.”
“When we look at the figures from the IEA analysis, what we see is simply an explosive trend: for investment; for deployment and for batteries in multiple applications. Because batteries are not just for the mobility sector and electric vehicles. Where they are becoming absolutely crucial is for energy storage,” writes Blasi.
"Well hear a lot about batteries in 2025," he predicts.
Longer duration
As revenue models transition from ancillary services to energy trading, or solar production shifts to the night, the duration of energy storage is also getting longer, especially in more mature markets.
“I think what we’re seeing is that because battery costs have come down so much over the last year, there’s an appetite to upgrade existing sites by adding more battery banks and more power capacity, or to develop new sites with longer durations because they can be better leveraged for energy switching or energy arbitrage,” Sekine says.
BloombergNEF reports that energy storage systems in the United States and Europe have an average lifespan of about four hours, while that figure drops to two hours in China, the worlds largest market.
BloombergNEF expects 71 GW/193 GWh of stationary energy storage to be deployed by 2025. |
