Massive Growth Expected in Battery Storage

Battery energy storage.
Published On
Aug 30, 2021

According to a report from the U.S. Energy Information Administration (EIA), battery storage is at the beginning of a major growth spurt. “Battery Storage in the United States: An Update on Market Trends” noted that the number of large-scale battery storage systems operating in the United States increased 28% in 2019, and it is likely to continue growing, based on preliminary 2020 data.

The report noted that significantly declining costs are driving the increased adoption of battery storage, even outside regions that have been early adopters. It noted that energy storage costs declined 72% between 2015 and 2019.

Furthermore, the report projects that the combined capacity of U.S. battery storage between 2021 and 2023 could grow tenfold beyond the 2019 figure, and thus end up contributing 10,000 megawatts (MW) to the grid.

In terms of large-scale battery storage, the number and total capacity of such units continues to grow in the United States, according to the report, and regional patterns strongly influence the nationwide market structure. Specifically, by the end of 2019, 163 large-scale battery storage systems were operating in the United States, a 28% increase from 2018. The maximum energy that could be stored at these sites (energy capacity) was 1,688 megawatt-hours (MWh), and the maximum power that could be provided to the grid from these sites at any given moment (power capacity) was 1,022 MW.

There is also growth in small-scale battery storage.

“In 2019, 402 MW of small-scale total battery storage power capacity existed in the United States,” the report said. “The states with the most small-scale power capacity outside of California include Hawaii, Vermont, and Texas.”

As noted earlier, massive cost declines are a major driver of the growth of battery storage.

“The costs of installing and operating large-scale battery storage systems in the United States have declined in recent years,” according to the report.

For example, average battery energy storage capital costs in 2019 were $589 per kilowatt-hour, and battery storage costs fell by 72% between 2015 and 2019, declining at a rate of 27% per year.

“These lower costs support more capacity to store energy at each storage facility, which can increase the duration that each battery system can last when operating at its maximum power,” the report said.

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