Energy storage is driving the transition
Constant advancements in battery technology, supported by the adoption of electric vehicles, are facilitating the energy transition
Renewables will overtake conventional power sources by 2032, making them the fastest-growing energy source globally. Ambitious policy goals target 100pc renewable power generation. The energy storage market is rapidly evolving to support these goals and it has a crucial role to play in helping to make these ambitions a reality.
In 2018, the global energy storage market expanded to record levels, with 147pc year-on-year growth in gigawatt-hour (GWh) terms. After a bump in the road in 2019, with a 13pc reduction in year-on-year deployments, we projected exceptional growth for 2020.
However, the coronavirus crisis has the potential to trim our global energy storage deployments forecast for the year by 19pc, which equates to a 3GWh reduction from our earlier projection. Notably, this would still make 2020 a record-breaking year with 12.6GWh deployed.
Looking further ahead, we expect to see growth in all directions as storage markets balloon over the next four years. By 2024, the market will increase to a sizeable 44GWh.
Since the first lithium-ion battery was commercialised in 1991, investments have been made consistently to improve battery technology. Today they are everywhere, from mobile phones and laptops to electric vehicles (EVs). The technology can support renewable energy systems by shifting and balancing power and keeping grids stable.
Lithium-ion batteries can also respond in less than a second; a crucial factor when it comes to power grid balancing. Lithium-ion has been around long enough to have the economies of scale that drive prices down. And it is flexible enough to have a variety of uses.
Storage for power and most EVs uses nickel, manganese and cobalt (NMC). The EV industry is continually pushing the boundaries of battery chemistry by investing in technology that will improve energy density. NMC 811 is the latest in the line of new-generation cathode chemistries that have been introduced to market.
Lithium iron phosphate (LFP) is another contender. While less energy dense than NMC, it will continue to have a place in the stationary storage market if it can compete on cost.
Range anxiety—running out of charge mid-journey—is top-of-mind for every EV manufacturer; consumers cite this as the number one reason not to buy an EV. To combat this, automakers are investing heavily in building better batteries and each new model boasts a bigger battery that offers more miles per charge.
Another key driver of innovation is supply chain sustainability. Concerns about human rights abuses in cobalt mining, along with worries about the security of supply and the metal’s high costs, have pushed the industry to reduce its reliance on cobalt.
As volatile renewables become the primary source of the world’s electricity over the next two decades, balancing supply and demand will become increasingly challenging.
Competitively priced energy storage will play a crucial role in keeping the system flexible. But energy storage will continue to hitch a ride on EVs: innovation in the sector would not be possible without huge investments from EV manufacturers.
As we look towards 2040, demand for batteries in EVs will dwarf demand from the energy storage and portable electronics sectors combined.