Battery Energy Storage Surges as Global Leader Emerges

Intermittent wind and solar generate electricity only when the wind blows or the sun shines. To be effective, these renewables need to store energy when it is in surplus and return it when demand is high. 

Tesla Megapack. Video used courtesy of Tesla

Various methods are used to store the energy, including pumped hydro (moving water from lower to higher reservoirs and back again), compressed air that can be used to turn an air motor or turbine, or electrolyzing water to form hydrogen to store and use in a gas turbine to power a generator. 

The electrical energy can also be stored electrochemically in a battery. Battery energy storage systems (BESS) have grown alongside renewable energy and offer hope and progress amidst climate change. 

Battery Energy Storage Growth

The BESS sector in the U.S. has experienced significant growth over the past five years, driven by legislative support, technological advancements, and increasing integration of renewable energy sources. By the end of 2023, the U.S. added 7.9 GW of installed BESS capacity, bringing the total to 17 GW. Projections suggest this capacity could almost double to more than 30 GW by the year’s end. The U.S. BESS market was valued at approximately USD 711.9 million in 2023. It’s expected to grow at 30.5 percent compound annual growth from 2024 to 2030.

California and Texas are leading the charge, with California alone accounting for about half of the nation's total battery capacity at 8 GW. Texas follows with significant contributions, driven by its expanding wind and solar generation capacity.

In 2023, the global energy storage market saw a record addition of 45 GW (97 GWh) of capacity, nearly tripling from the previous year. This growth is expected to continue, with more than 100 GWh of capacity likely to be added in 2024. The global BESS market was valued in 2023 at over $18.2 billion and is expected to reach $74.3 billion by 2036, growing at a CAGR of around 12.3 percent. By 2030, the BESS market is projected to be worth $120 billion to $150 billion. China is the largest BESS market, driven by low costs and large-scale deployments. The U.S. is the second-largest market, with Europe, the Middle East, and Africa also seeing significant growth, particularly in residential storage.

Megapack by Tesla. Image used courtesy of Tesla 

Battery Energy Storage Technology

Energy can be stored electrochemically in a battery in several ways. Each type of BESS technology has advantages and disadvantages that may apply to specific applications. Lithium-ion batteries are ideal for their high energy density and efficiency but come with higher costs and safety concerns. Lead-acid batteries are cost-effective and reliable but are heavy and require regular maintenance. Sodium-sulfur batteries offer high energy density and efficiency but need high operating temperatures (300-350°C), which can complicate their use and increase operational costs. Redox flow batteries provide scalability and safety but have lower energy density and higher material costs. The choice of BESS technology depends on the specific needs and application constraints.

The decline in battery prices, especially for lithium iron phosphate (LFP) batteries, has been a key growth enabler. LFP batteries are gaining market share due to their lower cost and absence of nickel and cobalt, which are more expensive materials in nickel-based cathodes used in higher energy density lithium-ion batteries in many electric vehicles.

The Top 5 BESS Companies

1. Tesla

Tesla is consistently mentioned as a leader in the BESS market. Known for its Powerwall and Powerpack solutions and, more recently, its Megapack, Tesla offers residential and utility-scale energy storage systems. Their products are praised for scalability, seamless integration with renewable energy sources, and advanced energy management capabilities.

2. BYD 

BYD, a Chinese multinational company, has become one of the world's largest BESS manufacturers. The company offers a comprehensive range of BESS products, from home energy storage systems to utility-scale solutions. BYD is known for its proprietary blade battery technology, which is recognized for its safety features and high energy density.

3. Samsung SDI

Based in South Korea, Samsung SDI is a prominent player in the BESS market. It produces high-quality battery energy storage systems using high-performance lithium-ion battery cells. Samsung SDI is known for its advanced R&D in battery cell technologies, resulting in reliable, safe, and cost-effective BESS products.

4. LG Energy Solution

LG Energy Solution (formerly part of LG Chem) is another South Korean company that stands out in the BESS market. It manufactures high-end residential, commercial, and industrial battery energy storage systems. LG Energy Solution is recognized for its long-lasting and highly efficient energy storage solutions, backed by extensive research in lithium-ion battery technology.

5. Panasonic

Panasonic, a well-established name in electronics, has successfully translated its expertise into the battery and energy storage sector. Known for high-quality products, the company makes a wide range of energy storage solutions. Panasonic's approach involves creating comprehensive energy storage solutions through partnerships and collaborations, combining battery technology and systems expertise.

BESS Busy in 2024

The Grid Storage Launchpad (GSL), a new facility funded by the Department of Energy’s Office of Electricity, is set to open on the Pacific Northwest National Laboratory-Richland (PNNL) campus in 2024. GSL aims to accelerate the development of advanced battery technology, enhancing reliability and reducing costs. This facility's research will complement ongoing efforts at PNNL's Electricity Infrastructure Operations Center, where experts are working to improve the resilience of the nation's extensive electrical grid. PNNL researchers are already testing innovative battery technologies, modeling new materials for more efficient and durable storage, and developing safe deployment strategies for new energy storage systems.

Grid Storage Launchpad’s research focus. Video used courtesy of PNNL

Developments in BESS technology are advancing worldwide.

Australia

• New England Solar Farm BESS: A 1,400 MW lithium-ion battery energy storage project in New South Wales, with a storage capacity of 2,800 MWh, set for commissioning in 2024.
• Orana Battery: A 415 MW/1660 MWh project by Akaysha Energy, set to progress in 2024.
• Waratah Super Battery: An 850 MW/1680 MWh project in New South Wales, part of the utility-scale battery storage activity surge.

Europe

• Stendal Energy Storage Project: Nofar Energy and Sungrow are developing a 116.5 MW/230 MWh BESS in Stendal, Germany, utilizing the latest liquid-cooled energy storage technology, PowerTitan2.0.
• Mertaniemi Battery Storage Project: The 38.5 MW BESS in Finland, announced by Ardian in February 2024, will support the country's power grid and renewable energy integration.
• Alcoutim BESS: A 5 MW/20 MWh BESS project announced in February 2024, part of Powin’s first European installation, supporting Portugal’s renewable energy goals.

United States

• Intersect Power Projects: Intersect Power is developing three standalone BESS projects in Texas (Lumina I, Lumina II, and Radian), each with a capacity of 320 MWh, expected to be operational in 2024.
• Spearmint Energy Project: The 300 MWh BESS project in Texas, completed in 2024, enhances the state's energy storage capabilities.

Canada

• Canadian Solar Inc. and its subsidiary, e-STORAGE, a part of CSI Solar Co., Ltd., have secured a contract from Nova Scotia Power to develop flagship energy storage projects at three locations in Nova Scotia: Bridgewater, Waverley, and White Rock. These projects, totaling 150 MW/705 MWh DC, are crucial for enhancing grid reliability and stability, supporting the province’s transition to cleaner energy.  Construction is scheduled to be completed by the end of 2026, and the first site is expected to be operational in 2025. 

Canadian Solar BESS project in the U.K. Image used courtesy of Canadian Solar

New Zealand

• Rotohiko Battery Facility: New Zealand's first grid-scale BESS, a 35 MW/35 MWh facility, was commissioned in March 2024 in Huntly, Waikato. The system will enhance grid stability and support renewable energy integration.
• Ruakākā Energy Park: This project includes a 100 MW BESS currently under construction, expected to be fully commissioned by December 2024. It is part of a larger energy park featuring a 120 MW solar farm.

China

• Energy Vault Project is the first commercial-scale project using Energy Vault’s gravity energy storage technology, a 25 MW/100 MWh system in Rudong, China. While this is not an electrochemical method of storing energy, it does provide an alternative way to store renewable energy.

Storage Momentum

These projects highlight the global momentum toward enhancing energy storage infrastructure, crucial for balancing supply and demand and integrating renewable energy into the grid. Increasing renewable energy integration, supportive policies, and technological advancements that have reduced costs are driving the growth. In the renewable energy transition, the role of BESSes in ensuring grid stability and efficiency is set to become even more critical.