USA flying start triggers rush for Energy Storage leadership · The Rethink Energy service at Rethink Technology Research is essential reading and provides quarterly tracking services

R E T H I N K T E C H N O L O G Y R E S E A R C H

GLOBAL BATTERY ENERGY STORAGE FORECAST TO 2030

Lead analyst: Peter White

USA flying start triggers rush for Energy Storage leadership

Companies mentioned in this report: Broad Reach Power, Coso Battery Storage, Diablo Energy Storage, Dominion Energy, EDF Renewables, Energy Storage Resources, Engie Development, Hawaiian Electric, Huanghe Hydropower Development, KiWi Power, Longroad Development, LS Power, NEC Energy Solutions, NGK Insulators, NextEra Energy, Pacific Gas and Electric, Pivot Power, RES, Southern California Edison, Southern Power, sPower, State Grid Corp of China, TerraGen, Tesla, TenneT, Tokyo Electric Company and Vistra Energy

“R e t h i n k h a s a c o m mi t m e n t t o f o r e c a s t i n g m a r k e t s t h a t o t h e r s s h y aw a y f r o m – t h o s e o n t h e v e r g e o f r a d i c a l t r a n s f o r m a t i o n ”

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Executive Summary

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Copyright © 2020 Rethink Research, All rights reserved.

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CONTENTS

Page

Table of Contents 2

Table of Figures 3

Introduction 4

Uses of BES 5

So how fast will energy storage happen? 6

The thinking and considerations around BES 8

How we see Battery Electric Storage (BES) working 9

BES growth in the USA 10

China and BES growth 19

European BES growth to 2030 21

Asia Pacific 24

Other Asia Pacific nations 27

Middle East and Africa 28

Latin America 29

Methodology 31

Forecasting investment possibilities across renewables 32

Contacts 33

About Rethink Technology Research 34


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GRAPHS AND TABLES

Page

Global Battery Energy storage to 2030 6

Capital Cost of BES in $ billions 6

Global BES by 2024 7

Global Battery Energy Storage to 2030 7

Global BES by 2030 8

USA Battery Energy Storage to 2030 11

USA breakdown BES by 2030 by major ISO 12

Chinese BES growth to 2030 in MW 20

European BES growth to 2030 21

European BES by 2030 22

Asia Pacific less China BES to 2030 25

India BES in GW to 2030 26

Middle East Africa BES to 2030 in MW 28

Middle East Africa BES to 2030 in MW 29

Latin America BES by 2030 30


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The Battery Energy Storage (BES) market, made up almost entirely of

lithium ion based technology, has been completely under-forecast

throughout the run up to the 2020s. Its sudden emergence on the scene,

in substantial installation sizes, has only just begun, mostly triggered

by US utilities acting, perversely (compared to Federal Government),

from climate ambition, led by a number of the larger US States.

Forecasters in the past have been aware of the growing US pipeline,

and as such have under forecast battery energy storage outside the US,

which is running perhaps 12 to 18 months behind the sudden surge in

the US market. This report hopes to correct that, by showing that out-

side the US, in the ten year time frame, momentum will build in four

key markets – China, the US, Europe and the rest of AsiaPac.

China is already acutely aware of the possibilities of lithium ion stor-

age, but the US is definitively about to take an early lead. At Rethink

Energy we are certain that Chinese authorities will close this lead al-

most as fast as it opens up, and that to a certain extent, it is the open-

ness of the US utilities and the public availability of their plans, and the

plans of the State Utilities Commissions, which shows very clearly how

the starting gun has been fired in the US, creating a concrete pipeline

that is easy to dig out.

Europe, especially in the UK and Germany, is equally ready for the on-

set of the BES market, but we expect them to move more slowly due to

cumbersome regulatory environments, which have not moved to stay

ahead of the BES market, and slower investment cycles.

Introduction


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When you talk to people in this market, it is clear there are multiple us-

es for energy storage, and that there are multiple potential owners

within the energy marketplace – from utilities themselves, to grid oper-

atives, to independent storage owners, to solar or wind farm owners, to

consumer facing energy businesses.

Energy storage has had to emerge from the fairly important, but not

financially significant frequency regulation and black start market, to

energy arbitrage, working in conjunction with intermittent supplies

supplying capacity and wholesale energy.

BES has also been described as offering spinning reserves, which are

both load following and load balancing. The other big usage area is the

deferral of transmission build out and for congestion relief where trans-

mission is inadequate.

As a peaker replacement, BES demonstrates its enormous potential for

profitability and sitting alongside solar, it can shift the responsibility

for balancing intermittent power back to the solar farm by partner solar

with storage.

Of course BES can work both behind the meter and in front of it, and as

such robust and intelligent software can harness much of that distribut-

ed power in many of these functions. BES can also be used to facilitate

a Demand Response shift, supporting utility strategies through the

smart meter. Finally BES can harness the batteries of parked and charg-

ing car batteries, something we have specifically avoided going into de-

tail on, in this report, but which we are fully aware of.

It is because of these multiple functions, that the interest has built and

built and during the past month some 2 GW of BES has been an-

nounced by just a handful of US utilities for implementation over the

coming 2 to 3 years.

Uses for BES


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This forecast indicates that XXX.X GW of energy storage will be in-

stalled, up from X.X GW of BES today. In terms of GWh of actual

battery cells, the great majority of this will be utility scale 4 hour stor-

age. In some small number of cases it will include some 6 hour configu-

rations. In all residential configurations, the amount installed varies be-

tween 1 and two hours of name-

plate output. For ease of discus-

sion, we will refer to this as all

being four hour, citing X,XXX

GWh for the entire market.

NREL published a paper aggre-

gating price reductions of BES

forecast by various provider, in

2019. It began with a price of

around $XXX per kwh and fell in

the median pricing to around

$XXX per kwh by 2030. Applying that pricing we get a total spend of

some $XXX.X billion in capital costs by the end of 2030, and a spend of

$XX billion a year now, rising to $XX.X billion on global BES.

So how fast will Energy Storage happen?


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Methodology

In all territories we have adopted a process of establishing the size of

installations by reaching out to industry alliances, and public numbers,

and the size of the immediate pipeline from public auctions, published

RFPs, and announcements of deals.

This gives a 3 to 4 years forecast, and from there we look at policy and

potential policy changes in the region and project from those pipeline

numbers. Throughout this forecast we have referred to our own Global

Solar Forecast, and looked at the critical periods when intermittent re-

newables (solar and wind) make up 25% of more of total electrical gen-

eration, and used that moment to accelerate our forecast formula. It’s

not so much magic, as hard work and a lot of attention to detail.


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Who should buy this report?

This report is critical to anyone working around grid energy storage. It

shows the dramatic acceleration going through the industry right now,

after years of companies experimenting with lithium ion battery cells,

with the USA at the center of activity.

This includes staff from solar developers, utilities, wind developers,

public utility departments, investors and politicians caught up in the

renewables debate.

“USA flying start triggers rush for Energy Storage leadership,” is a

forecast by region of battery energy storage (BES) their size, rate of in-

stall and their effect on renewables profitability.

The Rethink Energy service at Rethink Technology Research is essential

reading and provides quarterly tracking services for each of Solar,

Wind, Energy Storage and Hydrogen, each of which includes at least

one forecast each year. This report forms part of the Energy Storage

tracking service and subscribers will get 3 more quarterly updates.

If you are at all unsure of whether or not to invest in this report, then

please request FREE entry to our WEBINAR on this report on Tuesday

June 30th at 4pm BST. Email Simon Thompson to request webinar ac-

cess at [email protected]

This report will;

· Give you a key numbers to drop directly into planning spreadsheets

· Give you confidence in your scenarios planning fore BES

A direct eCommerce purchase can be made here on our website or you

can contact Simon Thompson, product manager at email

[email protected] or by phone at +44 1280 820560


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Rethink Energy is our energy service, made up of our Weekly Analysis and our quarterly

Tracking Services. These both include access to our deals database. We focus on the transition

from fossil fuels, and take in Wind, Solar, Energy Storage, Hydrogen in the tracking services

and our Weekly Analysis takes in more developments in things like the digitalization of the

grid, the rise of EVs and recharging points. Our deals database is freely accessible to any cus-

tomer and has over 2,500 live renewables deals.

This Report can be purchased as part of either our Hydrogen Tracking Service or our Energy

Storage Tracking Service. This is because we see the demise of Gas for Power almost entirely

replaced by either Green Hydrogen for Power or by Lithium Ion batteries.

Our quarterly tracking services show current installation counts and offers at least one forecast

each year. We also provide details of technical advances, and changes to renewables policy by

country, and access to the deals database.

Previous forecasts are available to all news customers of the tracking services :

• Natural gas will strand $1 trillion in power generation by 2050

• Energy Storage attached to 50% of solar installs by 2030

• Offshore Wind forecast; Offshore wind to drive 8m jobs, is key to decarbonization

• Floating Solar goes stratospheric once it partners with hydro

Tracking services are all $2,100 for one person, or $3,200 for a corporate license.

There are volume discounts if you want more than one of the tracking services.

You may also wish to buy our Weekly Analysis, which costs;

Single User license - $595

5 User license - $1,100

Corporate license - $2,200.

Forecasting investment possibilities across renewables

SUBSCRIPTION COSTS


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RETHINK LEADERSHIP

RETHINK ENERGY’S MAIN CONTRIBUTORS

Peter White - Principal Analyst

[email protected]

+44 (0)7734 037414

Harry Morgan - Analyst

[email protected]

+44 (0)117 925 7019

Peter White - CEO and Co-founder

[email protected]

+44 (0)7734 037414

Caroline Gabriel - Research Director

[email protected]

+44 (0)207 450 1230

www.rethinkresearch.biz


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Rethink is a thought leader in quadruple play, renewable energy, and 5G

wireless. It offers consulting, advisory services, research papers, webi-

nars, plus three weekly research services; Wireless Watch, a major influ-

ence among wireless operators and equipment makers; Faultline, which

tracks disruption in the video ecosystem, and OTT video, Rethink Ener-

gy, which monitors investment opportunities in the changing energy

landscape.

About Rethink Technology Research

Need more information?

Natalia Szczepanek (Marketing and Client Relations Manager)

[email protected]

+44 (0)117 925 7019


12

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Published June 2020

Documents

USA flying start triggers rush for Energy Storage leadership · The Rethink Energy service at Rethink Technology Research is essential reading and provides quarterly tracking services