Energy Storage System (ESS) Market Size, Share, Trend Analysis and Forecast by Technology (Electromechanical, Electrochemical, and Thermal Storage), End-Use and Region to 2026

Accessing the in-depth insights from the ‘Energy Storage System’ report helps to:

• Evaluate demand estimates and forecasts across key sectors/sub-sectors covered for key regions and countries around the globe.
• Carry out comprehensive coverage of the entire value chain and its ecosystem.
• Get an in-depth view of supporting regulatory trends promoting the adoption of ESS.
• Find potential growth opportunities in terms of volume (MW) and revenue ($Million).
• Foresee shift in the energy landscape and align business strategies to capitalize on them.
• Fetch detailed insights on technological development while highlighting the rising prominence of battery energy storage system.
• Enlist of energy storage projects, tenders, and contracts.

How is our ‘Energy Storage System’ report different from other reports in the market?

• The report investigates the global energy storage system sector in terms of demand based on technology, end-use, and region.
• The study entails a summarization of key factors or variables responsible for assisting market growth in the near future.
• Detailed segmentation by technology– Electromechanical, Electrochemical, and Thermal Storage
• Detailed segmentation by end-use– Grid-Scale, Commercial & Industrial, and Residential
• With more than 100+ charts and tables, the report is designed with an easy digestible qualitative content.
• The study presents intelligence around recent mergers & acquisitions and filed patents.
• The key market participants operating within this market and their respective profiles are laid out with dedicated sections on company overview, financials, products & services, recent developments, and deals.
• The competitive landscape section encompasses coverage of the key players and their recent developments. In addition, this section of the study also covers case studies around the implementation of energy storage system projects.

We recommend this valuable source of information to:

• Equipment Manufacturers
• EPC Vendors
• Power Generation Companies
• Transmission & Distribution Players
• Management Consultants and Investment Banks
• Private Equity Players

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Energy Storage System Market Report Overview

The energy storage system market size revenue was valued at $73.5 billion in 2023 and is expected to grow at a compound annual growth rate (CAGR) of more than 15% over the forecast period. The move toward the adoption of renewable energy sources is projected to pave new pathways for the development of energy storage systems over the forecast period.

Renewable energy, complemented by favorable market conditions and government policies, is being adopted on a large scale. Renewable technologies are at the center of energy sector transformations, with usage carried out along the value chain. The ESS offers the required flexibility to maintain a bridge between generation and load curves, thereby, preventing grid failures. This flexible characteristic offered by the ESS is anticipated to drive market growth over the predicted timeline.

Energy Storage System Market Outlook, 2019-2026 ($Billion)

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The deployment of renewable power generation projects surged in the post-pandemic era supported by incentives from the governments. For instance, as per the report published by the International Renewable Energy Agency (IRENA) in July 2023, the total global renewable energy capacity jumped from approximately 2,824.9 GW in 2020 to 3,381.7 GW in 2022. These new steps towards sustainability directly promoted the adoption of energy storage systems over the mentioned timeline.

Another key event that pushed the deployment dynamics is the Russian invasion of Ukraine, particularly for the European nations. This conflict prompted the European countries to revise their existing energy storage plans and explore new productive ways to reduce dependence from fossil fuels. As per the stats released by the European Commission, the new utility-scale deployment of the storage technology in the region reached 2.8 GW in 2022 with a plan to install over 200 GW by 2030.

Similarly, in the Asia Pacific region, the installation of renewable projects picked up in the post-pandemic era with China, South Korea, and India accounting for the new additions. Among these, China planned to achieve 1,200 GW of renewable energy from solar and wind by 2030. However, the country is expected to complete this target by the end of 2024, thus becoming the largest market of ESS globally in 2023. In addition, China is expected to generate approximately 1,000 GW of solar energy alone by 2026, thereby, opening new prospects for ESS deployment over the forecast period.

Energy Storage System Segmentation by Technology

Within segmentation by technology, electromechanical is projected to remain a dominant category over the forecast period. The electromechanical segment covers pumped hydro storage (PHS), flywheel energy storage (FES), and compressed air energy storage (CAES). The prominence of pumped hydro storage is estimated to continue over the predicted timeline owing to the system’s capability to provide a competitive and reliable manner of electricity storage. The PHS ability to control and distribute additional load while providing reduced energy loss and high efficiency makes it the most preferred electromechanical technology as compared to its counterparts.

Despite, the domination of electromechanical technology, the highest market growth will be captured by electrochemical technology over the forecast period. The rising popularity of electrochemical technology or battery energy storage systems (BESS) is estimated to generate new avenues for its deployment. The electrochemical technology is widely preferred in remote areas where there is a limited option to capture solar energy and wind energy. This technology system provides ease of access and further can be easily integrated with generators, solar rooftops, and small wind turbines. Owing to these aforementioned advantages, the electrochemical technology segment is projected to flourish over the predicted timeline.

The deployment dynamics of the electrochemical technology are expected to improve further with the upgradation of battery capacity and reducing cost. The lowering of prices and continued research and development for improving technology standards are expected to boost the commercialization of various BESS technologies and deployment on a large scale. The BESS market will likely grow exponentially in line with renewable expansion and increasing demand for self-consumption and uninterruptible power supply.

Energy Storage System Market Analysis by Technology, 2023 (%)

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The third technology category of thermal storage is predicted to remain the slowest-growing segment over the forecast period. The primary reason for this weak pace of growth dynamics is owing to its lower efficiency as compared to its counterparts. Despite this, the technology is favored for deployment along with solar energy projects owing to its lower cost.

Energy Storage System Market Segmentation by End-Use

The ESS market segmentation by end-use is estimated to be dominated by the grid-scale segment over the forecast period. The use of ESS on grid-scale is projected to increase steadily owing to the ability of the technology to offer transmission support, provide congestion relief, and defer transmission & distribution upgrades. An important trend to observe in the grid-scale segment is the rising popularity of bigger battery energy storage systems. For instance, in EU27, nearly 33 projects with a size greater than 50 MW came online in 2022. These trends are likely to greatly benefit the market growth of ESS in the grid-scale end-use segment over the forecast period.

The residential end-use segment is projected to witness the highest compounded annual growth rate over the forecast period. The prime factor promoting the growth of this end-use segment is the necessary step towards self-reliance. Moreover, government-based added benefits are projected to positively influence the development of ESS in the residential end-use segment over the near future. For instance, in the US, the federal investment tax credit (ITC) reduces the residential energy storage system cost by USD 3,000 to USD 5,000.

Energy Storage System Market Analysis by End-Use, 2023 (%)

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The commercial & industrial end-use segment is predicted to witness a compounded annual growth rate (CAGR) of 9.8% over the forecast period. The growth in this segment is to be delivered by the rising consensus among the industrial vendors to cut down their respective carbon emissions and opt for renewable sources of energy. For instance, in April 2023, the US subsidiary of the Swiss-based cement manufacturer Holcim signed the agreement to switch to 100% renewable energy by 2033 for its 13 production sites.

Energy Storage System Market Segmentation by Region

Asia Pacific captured the largest regional share in 2023 and is anticipated to remain the fastest-growing regional market for ESS over the forecast period. The growth in the market is primarily to be driven by China, India, and South Korea over the predicted timeline. Among these, China is anticipated to remain the largest regional market with significant additions made in the last year. For instance, in 2023, the overall renewable energy power capacity additions in China reached 301 GW which is approximately 59% of the global addition last year. Thus, massive renewable energy projects in the country are projected to aid the market development of ESS over the forecast period.

Similarly, the installation of energy storage systems in India has observed tremendous growth over the last few years. The country has planned to deploy approximately 45 energy storage projects over the coming 2 to 3 years. Moreover, the government of India is introducing various subsidies to promote the deployment of solar energy for residential use in the country.

For instance, in February 2024, the government of India announced a generous subsidy plan for the installation of a 3-kW solar rooftop system for residential homes. In addition, this solar rooftop plan also includes 300 units of free electricity for local consumers. Thus, appropriate incentives to boost clean energy deployment are expected to aid the market growth of energy storage systems in India over the predicted timeline.

Energy Storage System Market Share by Region, 2023 (%)

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EMEA is projected to remain the second-largest region with a projected compounded annual growth rate of 12.4% in terms of value over the forecast period. The European countries are making a great effort to decarbonize and move towards a clean energy future. For instance, the UK has got a strong project pipeline of 13 GW by 2030 with front-of-meter installations dominating the domestic market space. All these measures are anticipated to aid the market growth of ESS in the EMEA region over the forecast period.

Americas region registered third place in the global market space of ESS in 2023. The regional growth dynamics are to be supported by the US which accounted for the volumetric regional share of over 47% in 2023.

The introduction of the Inflation Reduction Act (IRA) of 2022 is estimated to remain a primary booster for the domestic ESS market in the US. This act allows the restructuring of the existing energy infrastructure which has ceased to operate under section 1706 and provides financial aid to repurpose these sites. Moreover, this act further supports employment opportunities in the country with an anticipated 1 million jobs in the clean energy and related manufacturing sector. These measures from the US government is expected to positively influence the ESS market growth over the forecast period.

Energy Storage System Market – Competitive Landscape

The competitive landscape of the global ESS market space is partially dominated by the vendors from China, South Korea, the US, Japan, and Europe. The acquisition activities have picked up significantly in the post pandemic era. For instance, in February 2024, Tropical Battery Company acquired the specialized battery manufacturer from the US Rose Batteries for an undisclosed sum. This acquisition will allow Tropical Battery Company to offer customized solutions to its B2B consumer base.

Another key trend to observe is the OEMs’ rising interest in acquiring manufacturers of advanced battery systems. For instance, in November 2023, Komatsu America Corp. a leading manufacturer of construction, mining, industrial, forestry, and heavy equipment announced to acquire 100% stakes of American Battery Solutions for an undisclosed value.

Lastly, there is an upsurge in clean energy project acquisitions. For instance, in October 2022, TagEnergy, a clean energy company, acquired Pitkevy battery storage project in the UK from Intelligent Land Investment Group Plc (ILI Group).

Leading Companies in the Energy Storage System Market

• GE Renewable Energy
• LG Energy Solutions
• SAMSUNG SDI CO.,LTD.
• NGK Insulators Ltd
• BYD Co Ltd
• Saft
• Amber Kinetics, Inc.
• Voith GmbH & Co. KGaA
• Contemporary Amperex Technology Ltd
• CALMAC

Other Energy Storage System Market Vendors Mentioned

ANDRITZ, Hydrostor Inc., MAN Energy Solutions SE, VYCON, C&D TECHNOLOGIES, INC., Fluence, Narada, Abengoa, Brenmiller Energy Ltd., A123 Systems LLC, Sinexcel, Xtreme Power Inc., NextEra Energy, Inc. , Tesla, sonnenGroup , and Leclanché SA.

Leading ESS Companies

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Energy Storage System Market Segments

GlobalData Plc has segmented the energy storage system market report by technology, end-use, and region:

Energy Storage System Market Technology Outlook (Revenue, $Million, 2019-2026)

• Electromechanical
• Electrochemical
• Thermal Storage

Energy Storage System Market End-Use Outlook (Revenue, $Million, 2019-2026)

• Grid-Scale
• Commercial & Industrial
• Residential

Energy Storage System Market Regional Outlook (Revenue, $Million, 2019-2026)

• Americas
  • US
  • Rest of Americas
• EMEA
  • Germany
  • France
  • UK
  • Rest of EMEA
• Asia Pacific
  • China
  • India
  • Japan
  • South Korea
  • Australia
  • Rest of Asia Pacific