Analyst IHS Markit has predicted storage will rebound this year following its first year-on-year decline in 2019. The technology is being rolled out at pace despite Covid-19 with state-level policies set to keep the US the global capital for the next five years.
With battery storage in particular blooming across the U.S. in recent weeks, analyst IHS Markit – which was among the doom-mongers as recently as a coronavirus-ravaged March – has now joined the chorus of voices predicting the technology which is so critical to the adoption of intermittent renewable energy has finally turned the corner.
The London-based forecaster has predicted storage deployment will hit 15.1 GW/47.8 GWh in 2025 and sees investment set to grow from an anticipated $4.2 billion this year to $9.5 billion in five years time’ – no mean feat given IHS has predicted battery module prices will fall 32% over the same period.
That falling battery price is one of the reasons cited for the impressive growth of storage deployment already being witnessed in the U.S. IHS Markit’s Energy Storage Service today predicted the States will stay the world’s number one market for the technology for the next five years, helped by a slew of ambitious state-level policies and an impressive project pipeline driven by the Investment Tax Credit.
Although the press release issued by IHS to publicize its predictions emphasized how well energy storage is weathering the Covid-19 storm – and, by implication, how much more storage might be deployed in less exceptional times – it made no mention of the fact 2020 is an election year in the world’s grid scale battery capital. It is tempting to speculate what sort of volumes of storage could be rolled out across the U.S. in the event a more environmentally conscious president were to enter the Oval Office.
China will be the number two energy storage market to 2025, according to IHS, which expects 6.5 GW of systems to have been developed by that point as the nation strives to even out energy supply from a rising tide of renewables generation assets.
And there are encouraging signs in other markets, said the analyst today, with a capacity auction in France set to drive 253 MW of storage capacity up to 2023 and grid scale pipelines set to increasingly benefit from the viability of merchant storage in the U.K. and Australia, thanks to the spread of wholesale energy prices between peak and off-peak hours.