Energy storage for renewables integration to reach $23B by 2026
- As the cost of global renewable energy projects declines, Navigant Research anticipates the worldwide revenue from energy storage for renewables integration (ESRI) will exceed $23 billion by 2026, with utility-scale and behind-the-meter applications expected to show the strongest growth.
- Solar energy has reached grid parity in several locations around the globe, the firm concluded, and no longer requires policy incentives to incentivize deployment in many markets. Even though energy storage costs are also declining, they remain a challenge.
- But while utility-scale renewable prices are experiencing bigger price declines, peak shaving and incentive programs specific to energy storage are helping drive the behind-the-meter segment.
As the cost of intermittent renewable resources and battery storage declines, Navigant researchers see an opportunity for energy storage system (ESS) revenues to grow significantly. But it will not be uniform growth, with the economics varying in different regions.
According to an executive summary of Navigant's new report, the argument for energy storage for
renewables integration "relies on several different factors," including: the condition and size of the local grid; the type and amount of renewable generation; retail rates of electricity; incentives and subsidies; and financing options.
"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," the firm concludes. "Additionally, declining costs of renewable generation, solar PV especially, are creating unique challenges for the energy storage market."
Standalone solar generation is proving to be economical without subsidies and without storage attached, "which can make ESSs unnecessary from a financial standpoint," the report noted.
Navigant research analyst Adam Wilson said because of the continued price drop in energy storage, solar PV and wind, storage for renewables integration is forecast to see strong growth across both utility-scale and behind-the-meter applications.
“Interestingly, while utility-scale renewable prices are experiencing bigger declines, formidable drivers in the BTM market, such as peak shaving and incentive programs specific to energy storage, are expected to push the segment to account for roughly two-thirds of forecast global ESRI capacity through 2026," Wilson said.
Asia Pacific is expected to lead all regions in ESRI deployment through the forecast period, reaching annual installed power capacity of 11,180 MW in 2026, the firm predicts.
- Energy Live News Integrated renewables and batteries ‘to be worth $23bn by 2026’
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