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Navigant: Utility-scale storage market will exceed US$2.5 billion by 2023

The utility-scale energy storage market will exceed US$2.5 billion in revenue by the year 2023, according to forecasting by Navigant Research, the research arm of consultancy Navigant.

The firm has published the report, ‘Advanced Batteries for Utility-Scale Energy Storage’, which includes analysis and forecasts of the global market for battery technologies. These technologies include lithium ion, sodium metal halide, sodium sulphur, flow batteries, advanced lead-acid and others.

In the report, Navigant predicts that from being an industry worth US$164 million in 2014, revenues from utility-scale storage will hit the US$2.5 billion mark and go beyond it by 2023. The firm argues that advances currently being made in electrochemistry are enabling grid management through batteries, which until recently would have been unthinkable due to concerns over safety, cost, durability and efficiency.

Examining the business cases for various utility-scale energy storage applications, the Navigant Research report also looks at the strengths and weaknesses of energy storage batteries and their suitability for each business case.

The use of electrical energy storage (EES) to accommodate new renewable energy capacity onto grid networks is being investigated in various regions. Large-scale flow battery experiments are being conducted in the UK and in Japan, while regulators in Puerto Rico and the US states of Hawaii and California have become among the first to mandate the use of energy storage on grids.

The report examines business cases such as that for ancillary services to grids including frequency regulation, load shifting and peak shaving, as well as cloud mitigation for solar and providing ramping capacity for wind power.

Interest in the various levels of energy storage has grown recently from players in the solar industry - in addition to providing residential storage systems on a trial basis, US company SolarCity's head of grid systems, Eric Carlson, revealed recently to PV Tech that the company had been actively looking at opportunities in the market for providing anciallary services to grid operators through EES.

Segmented by region, application, chemistry and sub-chemistry, the report makes forecasts for the global market in terms of energy capacity, power capacity and revenue. Navigant asserts that the highest growth in advanced battery use over the next 10 years will occur in the Asia-Pacific region, with North America and Europe also likely to see strong growth.

The report looks at battery manufacturers, from major lithium-ion companies such as BYD, LG Chemical and Samsung SDI, to other lithium-ion companies including A123, Leclanché and Saft as well as advanced lead-acid battery manufacturers and others, such as Aquion Energy, Enervault and GE.

Lithium-ion is the clear market leader at present, according to Navigant Research principal analyst Sam Jaffe, able to offer the best all-round mix of qualities. The report examines six sub-chemistries of lithium-ion. However other battery chemistries still offer potentially offer solutions for different applications. Lead-acid batteries are suitable for power-intensive uses while flow batteries using chemistries such as Vanadium Redox are particularly suited to long term storage applications.

A recent report by rival firm IHS forecast the grid-connected energy storage market to exceed 40GW globally by 2022, while GTM Research has forecast that over 700MW of commercial storage will be deployed in the USA between 2014 and 2020.

Sam Jaffe of Navigant Research and Eric Carlson of SolarCity are among the experts and industry figures interviewed for 'Put up or shut up time for storage', a feature article in Volume 12 of Solar Business Focus, PV Tech's sister publication, available online now.

This article has been amended to correct an error in the reference to the GTM Research forecast, which refers only to commercial storage and not all storage as originally published.

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