By any measure, 2019 was a breakout year for energy storage in the U.S. Fueled by improved economics, increased demand for resilience, and the ever-increasing integration of intermittent renewable generation, energy storage installations hit an all-time high of 522 megawatts/1,113 megawatt-hours last year.
Though coronavirus-related supply chain disruptions, macroeconomic damage and uncertainty have lowered 2020 installation forecasts, analysts remain bullish on the longer-term prospects of storage. According to Wood Mackenzie Power & Renewables, global installations will reach 15 gigawatts per year by 2024.
The explosive growth of storage is reminiscent of solar and wind, both of which have become mainstream generation sources thanks to dramatically improved economics, expanded manufacturing scale, policy support, and customer demand. However, like solar and wind, battery storage’s future growth depends on innovations that go beyond improved technologies and manufacturing-related economies of scale.
For example, project financing and business models are in dire need of innovation in order to both lower the costs of storage and make it more readily available to the commercial and industrial (C&I) space, developers and other customers that could directly benefit from its implementation. Addressing these often-overlooked areas will be a critical component of unlocking the transformational potential of storage.
Deconstruction leads to innovation
A close examination of North American battery storage costs led to the launch of Prisma Energy Solutions in 2017. “We noticed that the all-in cost of projects didn’t compute with what we understood,” said Matt Whitaker, Prisma’s Head of Technology and Procurement, who has decades of experience in energy, finance and technology. “So we started to deconstruct what those were.”
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