Battery Energy Storage System Market is Segmented by Type (Lithium-Ion Batteries, Lead-Acid Batteries, Nickel Metal Hydride, and Other Types (Sodium-Sulfur Batteries and Flow Batteries)), Application (Residential, Commercial, and Industrial (C&I), Utility-scale) and region (North America, Europe, Asia-Pacific, Middle East and Africa and South America).
The global Battery Energy Storage System (BESS) market size was estimated at USD 5.4 billion in 2023 and is projected to reach USD 26.9 billion in 2030 at a CAGR of 25.8% during the forecast period 2023-2030.
Battery energy storage systems are a type of technology that allows electricity suppliers to store excess power for later use. This technology is important because it improves the flexibility and reliability of the power grid in terms of power generation, transmission, and distribution. By storing excess power, electricity suppliers can better manage fluctuations in demand and supply, which can help prevent blackouts and other disruptions. Battery energy storage systems are particularly useful in areas where renewable energy sources like wind and solar are used, as these sources can be intermittent and unpredictable. The demand for uninterrupted power is expected to grow exponentially in the coming years due to factors like population growth, infrastructure development, and rapid industrialization.
Lithium-ion batteries are preferred over other battery technologies because they are lightweight, and lithium is one of the lightest elements in the world. This makes them ideal for use in portable devices and electric vehicles. Another advantage of lithium-ion batteries is that they use non-aqueous electrolytes, which provide high operating voltages as compared to other products. This means that they can deliver more power and last longer than other types of batteries. However, the high cost of lithium-ion batteries has been a restraint on the growth of the market. In the past, only a few manufacturers could afford to produce them, and they were mainly used in high-end products. With new technologies and developments, manufacturers have been able to bring down the cost of lithium-ion batteries to affordable levels. This has made them more accessible to a wider range of consumers and has led to an increase in demand for battery energy storage systems.
The spread of the COVID-19 pandemic resulted negative but the market has reached pre-pandemic levels such as declining prices of lithium-ion batteries are expected to drive the growth of the battery energy storage systems market. This is because lithium-ion batteries are the most commonly used type of battery in energy storage systems due to their high energy density, long cycle life, and low maintenance requirements. As the prices of these batteries continue to decrease, it becomes more cost-effective for businesses and households to invest in energy storage systems.
The presence of other battery energy storage technologies in the market can be a major obstacle to market growth means that the existence of other types of energy storage technologies can hinder the growth of the battery energy storage systems market. Energy storage can be performed in a variety of ways such as electrical, thermal, and mechanical energy. Electrical energy storage devices include capacitors and superconductors, while mechanical energy storage includes technologies such as hydropower, pumped storage, flywheel, and compressed air storage (CAES). Pumped Storage is a technology that uses electricity to pump water into elevated tanks, which can be used to drive hydroelectric turbines when electricity is needed. The United States has more hydroelectric pumped storage capacity than the battery storage capacity, which means that this technology is more widely used in the US than battery storage. Flywheels can be used to store energy by accelerating the rotating mass using an electric motor and later rotate the turbine to generate electricity. This means that the energy is stored in the rotational motion of the flywheel. To reduce loss, the mass rotates in a housing with little friction. This means that the flywheel is designed to minimize friction and other forms of energy loss, so that the stored energy can be efficiently converted back into electricity. Flywheels are ideal for performance-oriented applications that require many charge and discharge cycles. This means that flywheels are well-suited for applications where energy storage and retrieval is required frequently and rapidly, such as in electric vehicles or grid-scale energy storage systems.
North America to Dominate the Market