According to the Energy Storage Association, an energy-storage system improves the way electricity is generated, delivered and consumed. It certainly helps during power outages. More important is energy storage’s ability to balance power supply and demand instantaneously, making power networks more resilient, efficient and cleaner.

Currently, energy-storage systems make up about 2 percent of U.S. generation capacity. The market research firm IHS forecasts the energy-storage market will grow from its initial installation base of only 0.34 gigawatts (GW) in 2012 and 2013 to an annual installation size of 6 GW in 2017 and more than 40 GW by 2022.

“The energy-storage market is being driven by both regulatory moves that encourage the deployment of energy-storage systems and by an increased number of renewable-energy assets being connected to the grid,” said Peter Gibson, sales director, LG Chem Power Inc., Troy, Mich.

Another main driver of the energy-storage market, according to Georgianne Huff, project manager for the energy-storage technology and systems department of Sandia National Laboratories, Albuquerque, N.M., is improved grid reliability and flexibility. 

“Historically, the grid was overbuilt, and storage capabilities remained in the lines,” she said. “Today, energy storage is required to eliminate outages during storms or other events and to provide grid operators with the ability to operate more efficiently.”

Major trends

The leading market segment for energy storage is large, grid-scale applications.

“Energy-storage systems connected to the grid operate either for short, 15-­minute intervals­—or longer, 4- to 12-hour periods—enabling the system to deliver more cost-effective solutions that maintain voltage and grid frequency,” Gibson said. In particular, long-term energy-storage system operation provides a cost-effective way of controlling photovoltaic (PV) ramp rates and enables PV systems to be a more flexible, revenue-generating asset for the grid.

Technology developed for automobile applications, such as advanced lithium-ion batteries, is heavily influencing the stationary energy-storage system market. According to Huff, the lithium-ion technology industry is working on being able to scale up lithium-ion batteries for use in grid-size applications.

“Lithium-ion has been completely validated, and its performance and durability has been proven, giving customers of stationary energy-storage systems confidence in the technology’s abilities,” Gibson said.

Advanced lead-acid batteries, consisting of lead-carbon batteries and hybrid lead ultra capacitor batteries, are considered to be an excellent option, particularly for use in short-term energy-storage applications.

“These advanced batteries tend to have [more] improved cycling than traditional lead-acid batteries, last longer, and are currently a factor of cost lower than other electrochemical batteries,” Huff said.

Other energy-storage technologies include flywheels, thermal, pumped hydropower and compressed air storage.


New technology is always a challenge. There is a degree of validation that the industry needs to go through to prove energy-storage reliability. In addition, the industry needs to correct the market misperception that lithium-ion batteries are not safe.

“Designed and correctly applied, lithium-­ion battery packs do not pose safety hazards,” Gibson said.

Cost is another market challenge, although it is expected to decrease as the use and volume of energy-storage systems grows and technology continues to evolve.

Finally, the tools that dispatch centers and utility planners use to evaluate how to best deploy a grid’s assets don’t address energy storage. However, Huff said that software is being developed to address the planning, operations and building stages of energy-storage requirements.

What you need to know

The key message contractors need to hear is that energy-storage systems are past the pilot project stage and are commercially available and installed in projects today. To get involved in this growing market, Gibson said ECs should become familiar with what energy-storage systems entail and how they are deployed in a building or renewable energy system.

Although sometimes system integrators do energy-storage projects, electrical contractors also work with them.

“To improve, contractors need to understand how to properly connect, disconnect and interconnect energy-storage system batteries with the grid or transmission wires,” Huff said.

As the market moves forward, there will be more initiatives to develop standards that define how to integrate energy-storage systems into the grid. In the foreseeable future, Gibson said, energy storage will be considered a normal part of the electrical system, whether in utility grid applications or small residential projects. 

For more on this topic, see Smart Storage by Chuck Ross.