Growth Opportunities in the Residential Battery Energy Storage Systems Industry

Description

Distributed Solar, Battery Cost Declines, Incentives, and Supportive Regulations Sustain Double-Digit Growth

Battery energy storage systems (BESS) have become the fastest-growing clean energy technology driven by the growth of intermittent renewables and the need for grid flexibility. Homeowners are turning to batteries to maximize solar energy consumption, manage energy demand more efficiently, control costs, and reduce carbon footprint. Residential batteries are also functional for distribution networks. With the right regulations and price signals in place, home batteries can store distributed solar PV during high irradiation hours to be used during peak hours, reducing stress on the grids.

In 2023, the number of newly installed BESS almost doubled from the previous year, reaching 1.87 million new units, equivalent to an investment of $14.92 billion. Europe accounted for 72.3% of the world's storage capacity additions in 2023. Japan, Australia, and the United States also are important markets. The combination of higher income, higher electricity prices, the availability of incentives, and supportive regulations make investing in residential storage an appealing option in these locations. As a necessary complement to the expansion of distributed generation, these systems help nations reach their climate and environmental goals.

Frost & Sullivan forecasts global residential BESS market revenue to double to $31.31 billion by 2030, and then double again to $60.02 billion by 2035. This growth will be driven by cost declines, along with an average of 113 GW of residential solar and evolving incentives, and supportive policies and market rules. Residential storage capacity will register a compound annual growth rate of 15.8% from 2023 to 2035, achieving 592.55 GWh of cumulative capacity.

This study provides a region-level forecast and analysis of how residential BESS units, capacity, and investments will evolve by 2035. It discusses the main drivers and trends in the battery value chain, technology, business models, applications, and growth opportunities.

Product Code: KAFB-27

Strategic Imperatives

Why is it Increasingly Difficult to Grow?
The Strategic Imperative 8™
The Impact of the Top 3 Strategic Imperatives on the Residential Battery Energy Storage Systems Industry
Growth Opportunities Fuel the Growth Pipeline Engine™

Ecosystem

Scope of Analysis
Regional Segmentation
Key Findings

Trend Analysis

Key Trends Shaping the Industry
Trend 1: AI Revolutionizing the BESS Value Chain
Trend 2: Carrots and Sticks to Foster Self-consumption with Batteries
Trend 3: Solar-Plus-Storage, the Perfect Match
Trend 4: VPPs to Unlock Extra Value from BTM Storage
Trend 5: BESS Design Improvements
Trend 6: Shift Toward Home Energy Platforms
Trend 7: Predictive BESS Analytics
Trend 8: Higher Transparency and ESG Accountability for Batteries

Growth Opportunity Analysis

Residential BESS Value Chain
Key Residential BESS Suppliers
Key Applications for Residential BESSs
Growth Metrics
Growth Drivers
Growth Driver Analysis: Expansion of Residential Solar PV
Growth Driver Analysis: Supportive Policies, Incentives, and Market Rules
Growth Driver Analysis: Battery Production Capacity Expansion
Growth Driver Analysis: Cost Declines
Growth Restraints
Forecast Considerations
Cumulative Storage Systems Growth
Cumulative Storage Capacity Forecast
Annual Power Capacity Forecast
Annual Energy Capacity Forecast
Annual Energy Capacity Forecast by Region
Annual Energy Capacity in Top Countries
Capex Forecast
Capacity Forecast Analysis
Pricing Trends and Forecast Analysis

Regional Analysis

Regional Analysis: Market Status
Regional Analysis: Europe
Annual Additions by Sub-region: Europe
Regional Analysis: ANZ and Pacific
Annual Additions by Sub-region: ANZ and Pacific
Regional Analysis: North America
Annual Additions by Sub-region: North America
Regional Analysis: East Asia
Annual Additions by Sub-region: East Asia
Regional Analysis: China
Annual Additions: China
Regional Analysis: India and South Asia
Annual Additions by Sub-region: India and South Asia
Regional Analysis: Latin America
Annual Additions by Sub-region: Latin America
Regional Analysis: Middle East and North Africa
Annual Additions by Sub-region: Middle East and North Africa
Regional Analysis: Sub-Saharan Africa
Annual Additions by Sub-region: Sub-Saharan Africa
Regional Analysis: ASEAN
Annual Additions by Sub-region: ASEAN
Regional Analysis: Russia and CIS
Annual Additions by Sub-region: Russia and CIS

Growth Opportunity Universe

Growth Opportunity 1: Solar-plus-Storage Retrofits
Growth Opportunity 2: Energy Storage-as-a-Service
Growth Opportunity 3: Residential Battery Energy Storage to Add Higher Value to Customers
List of Exhibits
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