Two years of volatility in the lithium-ion battery storage industry have seen prices tumble and a host of supply-chain complexities come to the fore.

Despite geopolitical unrest, the global energy storage system market doubled in 2023 by gigawatt-hours installed. Dan Shreve of Clean Energy Associates looks at the pricing dynamics helping propel storage to ever greater heights.

As with previous years, our year in review wrap up of 2023 includes interviews with a handful of industry players from around the sector.

After a difficult couple of years which saw the trend of falling lithium battery prices temporarily reverse, a 14% drop in lithium-ion (Li-ion) battery pack cost from 2022-2023 has been recorded by BloombergNEF.

Argentina is set to launch a call for expressions of interest (EOI) for energy storage projects as it looks to reach 20% renewable energy in 2025.

Prices of lithium and the battery supply chain for energy storage systems are becoming manageable once again, but lead times for transformers and other equipment have greatly extended.

The lithium industry needs US$116 billion of investment to achieve the 5.7x ramp-up in production needed for 2030 decarbonisation goals, and prices may remain ‘tight’ in the coming years.

Lithium carbonate prices have started to creep back up again after coming down from 2022’s extreme highs, but the long-term outlook is one of downwards prices, research firm Fastmarkets said.

Lithium-ion battery pack prices have gone up 7% in 2022, marking the first price rise since BloombergNEF began its surveys in 2010.

The construction of battery cell factories catering specifically for stationary energy storage means competition for supply with the EV sector will cool off in the next couple of years.