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Utility-scale storage market to soar to $8.3bn, says consultant

The global grid-connected, utility-scale battery storage market is expected to leap twenty-fold in the next decade to $8.3bn, from $464m last year, according to a new analysis from consultants Frost & Sullivan.

Demand for grid-modernisation through rapid-response energy storage systems (ESS), particularly lithium-ion (Li-ion) batteries, is being fuelled by the worldwide growth in variable renewable energy generation, particularly wind and solar.

"Battery storage has the ability to impart flexibility to the grid across a variety of end-use applications," states Frost & Sullivan research analyst Ross Bruton, lead author on its Global Utility-Scale, Grid-Connected Battery Storage Systems Markets report.

"Its greatest advantages are the provision of distributed, variable renewable energy firming and energy time-shift, and rapid short-term electricity balancing for ancillary markets. Li-ion batteries are foreseen to be the leading technology for utility-scale ESS "over the next two to three years."

Driven by technology breakthroughs and a ramp up in manufacturing, industrialisation of ESS is forecast by Frost & Sullivan to start accelerating after 2017, bringing "huge opportunities" for companies that have the commercial capabilities to compete.

"Overall, attractive pricing, combined with a surge in manufacturing and supportive policies for renewable energy development, will increase the bankability of renewable energy associated storage projects," notes Bruton.

Despite current market optimism, early-stage challenges including high technology costs, a paucity of business cases, and "inadequate" incentives and supporting policies, continue to be drag on the sector's progress, he adds.

NOW READ: Special Report: The truth about energy storage

Note: Update corrects 2014 market figure to $464m

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