Market Trends of Grid Scale Battery Industry
This section covers the major market trends shaping the Grid Scale Battery Market according to our research experts:
Increasing Demand for Lithium-ion Battery
- The renewable energy sources like wind and solar energy are heavily reliant on the prevailing weather conditions which has been responsible for holding back the growth of renewable deployment. Therefore, the renewable integration with the energy storage system can easily help in the removal of the shortcoming and can provide uninterrupted power supply. With lithium-ion batteries providing a viable option, the demand for these batteries is expected to grow at a significant rate over the forecast period.
- Furthermore, due to technological innovations and improved manufacturing capacity, lithium-ion battery chemistry has experienced a steep price decline of over 80% from 2011-2018, and prices are projected to decline further. The lithium-ion battery is expected to dominate the market, and is expected to grow during the forecast period, due to its high energy density, fast recharge capability, and high discharge power.
- Furthermore, the recycling of Li-ion batteries is expected to secure the supply of raw materials, such as cobalt and lithium, and reduce the dependence on extracting and refining materials from mineral resources. Recycling of lithium-ion battery that is currently being used in EVs offers an opportunity for companies to utilize the refined constituent materials, for manufacturing lithium-ion batteries that are to be used for Energy Storage Systems (ESS).
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Asia-Pacific Region to Dominate the Market
- Asia-Pacific is expected to continue its dominance in the grid-scale market over the forecast period. The region consists of countries with tremendously increasing electricity demand due to urbanization and population growth.
- The expanding grid in developing countries to meet the electricity demand is likely to include large amounts of renewable energy, which is becoming increasingly cost-effective throughout the world. The deployment of renewable is likely to bestow the opportunity for the increase in demand for grid-scale batteries during the forecast period.
- Furthermore, developing countries like India are aiming to create 275 GW of total wind and solar capacity by 2027. Renewable energy's share of installed capacity is forecast to rise to 43% by 2027. With the growing renewable sector, the demand for grid-scale batteries, to address the challenges related to intermittency in renewable power generation, is expected to grow.
- Favorable policies, such as the energy efficiency standards and increasing peak demand charges, is expected to drive the demand for grid-scale batteries in the region.
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