Advanced Energy Storage Systems Market: Current Analysis and Forecast (2022-2028)

Advanced energy storage provides an integrated solution to most critical energy needs such as electric grid modernization, reliability, resilience, and sustainable mobility. Storage technologies strengthen and stabilize the grid by providing backup power, leveling loads, and offering a range of other energy management services. Moreover, electric vehicles (EVs) are also poised to become an integral part of this new grid paradigm as their batteries both draw power from and supply it back to the grid (when beneficial) - while eliminating tailpipe emissions.

Furthermore, emerging economies are taking various favorable steps towards developing advanced storage for applications like telecom infrastructure and e-vehicles. Also, leading telecom companies in India have already announced the deployment of Li-Ion batteries for reducing diesel consumption for over 100,000 telecom towers and there is additional anticipated demand for similar solutions for 400,000+ towers over the next 5 years. In addition, favorable government policies and subsidies for green mobility and improved IT infrastructure is also driving the advanced energy storage market.

Based on the application, the advanced energy storage systems market is bifurcated into transportation and grid storage. Transportation acquired dominating share in the advanced energy storage systems market. The growing adoption of lithium-ion batteries in electric vehicles will drive the market size of the advanced energy storage system (AESS). It is mainly owing to the increasing need for peak shaving & shortening up electricity supply during load hours will further increase the penetration rate of AESS in transportation applications.

Based on technology, the advanced energy storage systems market is classified into thermal, molten salt, batteries, compressed air, and flywheel. The thermal storage segment caters to a significant market share. Thermal energy storage is a technology that uses heat to store energy. Thermal energy storage systems can be used to store thermal energy from renewable sources, such as solar or wind power, and are useful during peak hours. Moreover, thermal energy storage systems are relatively inexpensive and when located close to the source of renewable power they can provide backup power for grid stability.

Based on the end-user industry, the advanced energy storage systems market is segmented into industrial, commercial, residential, and utility. The residential segment acquired the highest share of the advanced energy storage systems market. Factors such as increasing demand for renewable energy sources and the need for energy storage solutions in residential homes is driving the growth of the market. The installation of advanced energy storage systems enables residential homeowners to store excess energy generated during the day for use during peak hours. Moreover, the integration of smart grid systems provides the necessary flexibility and reliability to support the integration of renewable energy sources into the grid increasing the demand for advanced energy storage systems in the residential sector.

For a better understanding of the market adoption of the advanced energy storage systems market is analyzed based on its worldwide presence in the countries such as North America (U.S., Canada, and the Rest of North America), Europe (Germany, U.K., France, Italy, and Rest of Europe), Asia-Pacific (China, Japan, India, Rest of Asia-Pacific), Rest of World. North America is anticipated to grow at a substantial CAGR during the forecast period. This is mainly driven by the government support in the region coupled with initiatives to promote renewable energy and reduce carbon emissions are accelerating the demand for ADESS. In addition, advanced energy storage is a rapidly evolving technology that is critical for electricity grids and various key players are actively developing and deploying the advanced energy storage systems. For instance: in Feb 2023, Developers of the Oneida Energy Storage project (250 MW energy storage project) in Ontario, Canada, secured a battery supply deal for Tesla's Megapack system.

Some of the major players operating in the market include: ABB Ltd., AES Corporation, CALMAC Inc., Ecoult Energy Storage Solutions, Evapco Inc., General Electric Company, GS Yuasa Corporation, Hitachi Chems, Lockheed Martin Corporation, Panasonic Corporation.