While the global energy storage industry has continued its pace of rapid growth during the past year, well-established markets remain highly concentrated in specific regions of the world. In fact, Navigant Research expects the top five country markets to account for 56% of the new energy storage capacity forecast to be built in 2017. Over the coming years, this dynamic will change, as the industry is already seeing significant geographic diversification.
Navigant Research’s latest Country Forecasts for Energy Storage reports explore the growth trends for energy storage at the utility-scale and distributed levels in 26 countries around the world. This article highlights the leading countries for energy storage identified in those two reports, explores the factors shaping these markets, and explains how these and other factors can be used to determine where and when new markets will emerge.
Global and country-level dynamics
The economics of new energy storage projects are improving in countries globally, driven by:
- Falling hardware costs
- Increasing electricity market deregulation to increase competition
- Increasing investor confidence in energy storage technology
- Improving storage system value due to advanced software capabilities
Although there are many overarching drivers in this industry, the specific dynamics of individual markets vary considerably. There will be a varying mix of storage technologies and applications in different countries, depending on local conditions. One key factor differentiating markets is the attractiveness of storage in different market segments, specifically the split between front-of-the-meter (FTM) and behind-the-meter (BTM) systems.
A major focus for Navigant Research is understanding the specific dynamics of energy storage markets to forecast when and where significant growth will occur. Factors such as electricity market structure, retail rates, and renewable energy deployments (among others), have resulted in energy storage markets taking shape in unique ways in different countries. For example, some countries have seen major growth in utility-scale FTM storage deployments, but little to no activity on the BTM side. Alternatively, other countries and regions have seen growing popularity of customer-sited BTM storage systems, but much less demand for FTM projects.
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