As energy is needed in almost every sector of industries, the energy storage system market has a crucial role. This market includes a wide range of products that can be stored and used later when needed, like thermal energy storage, batteries, compressed air energy storage, and many others.
Being expected to reach 67.01 GW by 2030, the Energy Storage System (ESS) in the United States was only 27.57 GW back in 2022, indicating a significant growth.
According to GMI Research, the Energy Storage System was projected to grow at a CAGR of 10.5% during the forecast period, 2022-2029..
Factors That Boost The Growth of Energy Storage System Market
From the rising concern of environmental pollution to the grid modernization initiatives, there are several factors that drive the growth of the Energy Storage System Market.
- The rising concern of environmental pollution
The rising concern of environmental pollution can be seen as one of the drivers to the increasing demands of energy storage systems. Society’s demand for cleaner and sustainable alternatives can be achieved by energy storage systems.
By storing excess energy, it can help reduce reliance on fuels, mitigate emissions that can be harmful, as well as optimize renewable energy utilization.
- Increasing demand for electricity in remote areas
In developing countries, the surge of industrialization and urbanization also boosts the need for energy storage systems. Furthermore, the adoption for electric vehicles throughout the world strengthens the call for energy storage system implementation.
- Government policies
Governments in several countries have their own energy policy framework. Thus, they have policies that require operators to own an energy storage in a certain amount. These policies will push the investment in this sector.
- Grid modernization initiatives
Energy storage systems can provide the tools to manage the fluctuation of energy’s supply and demand, as well as optimizing energy usage. Therefore, the growing initiatives for grid modernization can boost the urgency of the energy storage systems.
Challenges and Opportunities
Nevertheless, there are some challenges and opportunities for energy storage systems as it grows.
One of the challenges is the high cost of energy storage systems that can hinder its adoption. It can be tackled by lowering the costs, whether by government policies or technological improvement.
There is also a growing concern related to the environmental impact of energy storage systems.
Not only that, installing the battery energy storage system in remote areas can be another inconvenience. The limited grid power in those areas can make the installation becomes more challenging. Not to mention the regular maintenance that can face difficulties resulting from the lack of local service providers and limited spare part accessibility.
Despite the barriers, there are also opportunities for the growth of energy storage systems. Although costs can be a problem, the prospect of the decrease in prices of lithium-ion batteries can be the light at the end of the tunnel. This reduction can make energy storage systems become more affordable and accessible.
Furthermore, as the energy storage system market is seeing an uptick, it can enhance transportation electrification. It, in turns, can help to reduce emissions and strengthen the opportunities for sustainable mobility.