April 12, 2024

Advanced Energy Storage is Expected to be Flourished by Growing Demand For Renewable Energy Integration

The advanced energy storage market comprises battery technologies like lithium-ion batteries, lead-acid batteries, sodium-sulfur (NaS) batteries, flow batteries, and other technologies like hydrogen fuel cells, supercapacitors, and flywheels that are used for storing electricity efficiently. Advanced energy storage technologies find usage in consumer electronics, electric vehicles, utilities, industrial applications, and commercial and residential applications. Lithium-ion batteries are widely used in consumer electronics such as smartphones, laptops, power tools and electric vehicles. Sodium sulfur batteries are used in grid-scale energy storage applications.

The global advanced energy storage market is estimated to be valued at US$ 16.9 billion in 2024 and is expected to exhibit a CAGR of 5.6% over the forecast period 2024 to 2031, as highlighted in a new report published by Coherent Market Insights.

Market Dynamics:

Growing demand for renewable energy integration and increasing investments in grid energy storage are the key drivers of advanced energy storage market. As renewable energy has an intermittent nature of power generation and cannot match the demand perfectly, the need for energy storage is growing rapidly. Utilities and power grid operators are increasingly adopting grid-scale stationary energy storage using lithium-ion batteries and sodium sulfur batteries to balance the load and ensure grid flexibility with higher renewable energy addition. Regulatory policies and incentives promoting renewable energy also increase incentivized demand for energy storage systems for grid stability. Supportive government policies and investments boost the development and commercialization of advanced energy storage technologies.

Segment Analysis:

The advanced energy storage market comprises lithium-ion battery, lead-acid battery, flow battery, and other battery technologies. Lithium-Ion battery segment currently dominates the market and accounts for over 50% share, due to high energy density and increasing demand for EVs. The uptake of lithium-ion batteries is further propelled by growing installations of rooftop solar panels and declining battery prices. Flow batteries segment is envisioned to witness the fastest growth on account of long duration discharge capability and flexible power rating.

PEST Analysis:

  • Political: Stringent emission regulations by governments worldwide to address climate change and promote clean energy adoption is positively impacting the advanced energy storage industry. However, inconsistent EV incentives and subsidies across nations poses challenges.
  • Economic: Declining battery costs and improving efficiency is making alternative technologies economically viable. Growth in consumer discretionary spending on sustainable technologies and rising investments in grid infrastructure modernization is fueling the market demand.
  • Social: Increasing public and private support for renewable energy and concern towards environmental issues is driving the preferences for cleantech. Rapid urbanization and modernization of off-grid and rural communities necessitate robust energy storages.
  • Technological: Advancements in nanotechnology, materials science, and battery chemistry are resulting in higher energy densities, longer lifecycles, and improved safety of batteries. Digitalization and integration of IoT, AI, and cloud computing is enhancing the power management capabilities.

Key Takeaways:

The global advanced energy storage market is expected to witness high growth at a CAGR of 5.6% during the forecast period of 2024 to 2031 to reach a market size of US$ 16.9 Billion in 2024.

Regional analysis indicates Asia Pacific dominates currently due to massive renewable investments and EV push in China, South Korea and Japan. Europe is envisioned as the second fastest growing regional market owing to supportive regulatory environment and technological advancements.

Key players analysis: Key players operating in the advanced energy storage market are ABB Ltd., LG Chem, Ltd., Samsung SDI Co., Ltd. ABB Ltd. ranks among the top players globally and leads the energy management solutions space. LG Chem and Samsung SDI are leading Korean battery manufacturers with strong footprint across Li-ion battery production for consumer electronics, automotive and grid storage applications.