Publications

- January 1, 2021: Vol. 8, Number 1

The gigawatt economy: U.S. energy storage market shatters records in Q3 2020

by Mike Consol

Some 476 megawatts of storage were deployed in third-quarter 2020, an increase of 240 percent over the previous high set during the previous quarter. What’s more, the U.S. battery energy storage market is set to grow from 1.2 gigawatts in 2020 to nearly 7.5 gigawatts in 2025, driven primarily by large-scale utility procurements, and solar-paired storage will account for a large majority of these installations, according to the U.S. Energy Storage Association.

The major growth was in the front-of-the-meter (or offsite) market segment, accounting for nearly 400 megawatts and 578 megawatt hours deployed during the third quarter, surpassing previous records of 133 megawatts and 296 megawatt hours for this sector. More front-of-the-meter market storage was installed in the third quarter than was installed across all segments during any other quarter over the past seven years, reports Wood Mackenzie.

Meanwhile, the residential storage market has grown steadily for six consecutive quarters, hitting 52 megawatts in third-quarter 2020, and the sector is poised to expand sixfold through 2025, according to forecasts, with increasingly active markets in Florida, Massachusetts, New York and Texas, among other states.

“Energy storage deployments continue to grow, despite the economic downturn and COVID-related slowdowns,” said Kelly Speakes-Backman, CEO of the U.S. Energy Storage Association. “The signs are pointing toward an unprecedented increase in energy storage in the coming months, moving us closer toward achieving our 100 gigawatts by 2030 vision. With continued policy support and regulatory reform at the state and federal levels, energy storage is poised to continue this trajectory and enable a more resilient, efficient, sustainable and affordable electric grid for all.”

Dan Finn-Foley, head of energy storage at Wood Mackenzie, added: “These eye-catching deployment totals represent only the beginning of a long-anticipated scale up for the U.S. storage market. Massive price declines and efforts to ensure eligibility have set the stage for exponential growth. Considering the scale of systems anticipated for 2021, we do not expect this record, as remarkable as it is, to stand for long.”

 

Mike Consol (m.consol@irei.com) is editor of Real Assets Adviser. Follow him on Twitter @mikeconsol to read his latest postings.

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