Need for speed: Storage growth accelerates
The rise of energy storage in the UK and US shows no sign of stopping.
New data covering both markets demonstrates the sector’s dramatic growth.
And the good news for energy storage investors is that this growth is only going to accelerate.
The UK ended 2020 with a pipeline of over 16GW in battery storage projects, that are operating, under construction or being planned across 729 projects, according to data published last week by RenewableUK. By comparison, in December 2019 – the previous time RenewableUK published such data – the UK had a total pipeline of 10.5GW across 600 energy storage projects.
Moreover, RenewableUK also revealed an additional 6GW of energy storage from liquefied and compressed air, pumped hydro, flywheels and gravity-based technology is in the pipeline, bringing the total UK energy storage portfolio capacity to more than 22GW.
The growth of US energy storage was even more impressive in the last year.
According to renewables body the American Clean Power Association, battery energy storage capacity “set its own record last year”, with utility-scale storage installation increasing more than 300% compared to 2019. With the 734MW installed in 2020, cumulative capacity increased 72% to 1,756 MW.
Meanwhile, elsewhere, the first two utility-scale battery storage projects in Ireland became operational in 2020, and, according to Social Media Market Research, there is now a utility battery storage pipeline of more than 2.5GW.
UK storage unshackled
So, given the recent data illustrating the growth of energy storage in the UK, US and Ireland, what has been behind the boom?
In the case of the UK, energy storage capacity has increased substantially because, in the view of Chris Hewett, chief executive of the Solar Trade Association, it is seen as being crucial in order to “unlock the full potential of wind and solar energy”. But even Hewett has acknowledged that the growth of the UK energy storage sector has been much faster than anticipated.
The UK market was given a further boost in July 2020 when Minster for Energy and Clean Growth Kwasi Kwarteng said that the government would allow local planning authorities to determine battery projects of 50MW and above rather than the secretary of state, which can be a longer and more costly process.
US: Energy storage’s time has come
Meanwhile, from a US perspective, we’re beginning to see the results of legislation passed in recent years aimed at cutting carbon emissions. For example, in California in 2018, legislation was passed that requires all of the state’s electricity to come from carbon-free sources by 2045.
Following the election of Joe Biden as US president, the future of energy storage looks even brighter. Upon confirmation of the election result, the then CEO of the US Energy Storage Association, Kelly Speakes-Backman, nailed her colours to the mast
She said: “By electing Joe Biden as President of the United States of America, Americans have sent the signal to accelerate the path forward toward a clean energy economy. We expect to see strong support from the new administration focused on decarbonisation of the electric and transportation sectors, which will further drive the deployment of energy storage.”
And the US energy storage ‘love-in’ continued when it was announced on 21 January that Speakes-Backman would be stepping down from her ESA role to join the US Department of Energy as Principal Deputy Assistant Secretary of Energy Efficiency and Renewable Energy.
It’s clear that, in the US, energy storage’s time has come.
Growth in the US market has also been given impetus by the drop in pricing for utility-scale battery storage.
According to the US Energy Information Administration, the price of utility-scale battery storage in the US dropped a massive 70% between 2015 and 2018. Wood Mackenzie has said that battery price reductions were the biggest driver in system costs falling “faster than anticipated” during the last year.
Exploding on a global scale
What’s the global picture?
IHS Markit has predicted a five-fold increase in global grid-connected storage to a capacity of 15.1GW, with an output of 47.8GWh, by 2025.
But that may just be the beginning. The UK-based emerging technology market research firm IDTechEx has projected that global energy storage could reach a staggering 1,200 GW in the next decade.
Energy storage has been growing rapidly in the US and UK in recent times, as data proves, and this growth is only going to accelerate in the coming years.
If you haven’t invested in energy storage yet, now could well be the time to take the plunge.