Market Trends of South America Battery Energy Storage System Industry
This section covers the major market trends shaping the South America Battery Energy Storage System Market according to our research experts:
Lithium-ion Segment to Dominate the Market
- South America has some of the world's greatest lithium reserves. The lithium triangle in South America consists of Chile, Argentina, and Bolivia. These regions are estimated to have almost half of the world's lithium reserves.
- In 2021, Chile and Argentina produced almost 30% of the global lithium demand, which was about 26 thousand tons and 6 thousand tons, respectively. Even though the initial investments and time for extraction of lithium reserves are relatively high in these regions, thereafter production is cheaper than techniques.
- Lithium-ion battery storage systems are in high demand in the South America battery energy storage market because they are advanced and widely available solutions for storing energy from renewable energy sources in the region.
- For instance, in May 2022, Global energy storage group NHOA, formerly Engie EPS, was awarded a 30MWh Battery Energy Storage System (BESS) to be developed in Peru. This BESS is expected to be installed at the 800MW Chilca thermal power plant in Peru, where it will deliver primary frequency regulation services for the country's grid.
- Moreover, Lithium-ion batteries are safer than other battery technologies, and all the battery manufacturers ensure safety measures and standards to protect consumers in case of a battery failure.
- Therefore, owing to the abovementioned points, the Lithium-ion segment is expected to dominate the South America Battery Energy Storage System Market.
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Chile to Dominate in the Market
- Chile has become a regional leader in lithium-ion battery energy storage systems to manage its renewable energy reserves more efficiently. The country is home to a huge amount of lithium reserves, most of which are found in the Atacama Desert in the northern part of the country.
- Chile's renewable energy installed capacity reached 14.89 GW in 2021. In recent years renewable energy projects have increased in Chile due to increasing priority on energy security and minimizing the reliance on conventional energy sources.
- Since renewable resources such as solar and wind generate power intermittently and at different levels, storing this energy during peak demand is critical. As a result, battery energy storage systems (BESS) are becoming essential to renewable energy projects. The rapid growth of the renewable energy sector is expected to be one of the most potent drivers in Chile.
- For instance, in September 2022, Canadian Solar Inc announced that it was awarded a 253 MWp solar plus 1,000 MWh battery energy storage project in Chile's public tender CNE 2022/01 held by Chile's Energy National Commission (CNE) in July 2022.
- Developments in the photovoltaic market, alongside implementing more efficient battery energy storage systems, are positioning Chile as a regional leader in this field.
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