February 19, 2021 Read More →

IHS Markit says annual global battery storage installations will top 10GW this year

Energy Storage News:

Analysis and research firm IHS Markit has predicted that over 10GW of new energy storage will be deployed during this year, with around half of those additions in the US market.

The company said in a new report that this would be more than double the 4.5GW of global capacity additions in 2020. Meanwhile the US’ strong lead will continue with the market gaining in share until 2023, when IHS Markit senior analyst for clean technology George Hilton said the pipeline in the country reduces.

His colleague, IHS Markit director for climate and sustainability Sam Wilkinson said that the US market will triple in size year-on-year, with energy storage beginning to provide capacity “at a significantly wider scale,” while development cycles will be complete for solar-plus-storage installations that have taken advantage of the Investment Tax Credit and those projects begin to come online.

The ITC in the US reduces the tax burden on solar energy projects through to the end of 2025 and applies to energy storage if installed at the same time and co-located as solar projects. While the ITC had been originally expected to expire in 2017, it has been extended twice and remains at 26%. It begins to fall in 2023 to 22% and in 2024 will fall to 0% for residential solar and 10% for commercial and utility solar. The energy storage industry, led by the national Energy Storage Association, has lobbied for the introduction of an ITC applicable for standalone energy storage but action has yet to be seen on this front.

Partly, but not only, driven by the ITC, combination with solar is becoming a “major driver” of energy storage, Wilkinson said. In the US, 1.3GW of tenders for solar-plus-storage have been awarded or announced in the past six months alone. Worldwide IHS Markit is forecasting that 3.8GW of storage co-located with solar will be installed. In 2020, the figure was just 0.9GW. Lawrence Berkeley National Laboratory said in August last year that at that time, around 28% of 102GW of solar PV projects in US interconnection queues were hybrids paired with storage.

Elsewhere, Europe’s energy storage market will grow significantly during this year, IHS Markit said, increasing by around 70% from 2020, due to a combination of new opportunities in frequency response, capacity and renewables colocation markets.

[Andy Colthorpe]

More: IHS Markit predicts more than 10GW of global energy storage deployments in 2021

Comments are closed.