The overall battery energy storage of the US market reported a record-breaking capacity installation of 5,597 megawatt hours (MWh) in Q2 2023, Electrek reports.
“The energy storage market is on pace for a record year, as utilities and larger power users increasingly turn to storage to enhance the grid and improve reliability.
The market is on pace to nearly double annual installations despite supply chain challenges and interconnection delays, and will continue to grow quickly in coming years.”
ACP’s Research Analytics VP, John Hensley
Notably, this significant industry growth is largely due to the strong performance of the grid-scale sector in the second quarter of the year.
Grid-scale installations
The US grid-scale energy storage sector accounted for a whopping 5,109 MWh of the total 5,597 MWh capacity installation in Q2 2023, Wood Mackenzie and ACP’s recent Energy Storage Monitor report indicated.
This remarkable capacity installation enabled the grid-scale sector to surpass its former highest record in Q4 2021 by a notable 5% margin.
It is also worth noting that the sector recorded a significant quarter-on-quarter growth of 172%.
Unsurprisingly, California dominated the rankings against all US states with an unprecedented grid-scale energy storage capacity deployment of 738 MW and a 49% share in the overall installed capacity.
“We saw a huge bounce back in Q2 after consecutive quarterly declines in the market,” said Vanessa Witte, senior analyst with Wood Mackenzie’s energy storage team. Many projects delayed from prior quarters, largely due to supply chain issues, were able to come to fruition this past quarter.”
Vanessa Witte, Wood Mackenzie’s Senior Analyst
That said, Wood Mackenzie forecasts that the grid-scale energy storage sector will be the primary growth driver of the market from 2023 to 2027. It expects this particular sector to contribute 83% of the overall capacity installations to 55 gigawatts (GW).
CCI and residential storage installations
The report also revealed that the community, commercial, and industrial (CCI) energy storage sector achieved a remarkable capacity installation of 107 MWh, up from any quarters last year. However, it failed to match the record in Q1 2023 with a 53% decline in QoQ. Nonetheless, it still grew by a notable 25% YoY.
Meanwhile, residential storage installations recorded a two-quarter consecutive drop to 381.2 MWh in Q2 2023 from the previous quarter’s 388.2 MWh.
According to the report, California suffered the largest drop of 17% QoQ and 37% YoY. Nonetheless, Wood Mackenzie remains optimistic that the residential energy storage segment will significantly improve as per its five-year outlook.
“We still project strong growth for the residential segment in our five-year outlook, reaching a total of 8 GW in 2027. However, the CCI segment continues to fail to meet growth projections and we have downgraded its five-year growth forecast by 28% to 3 GW.”
Vanessa Witte, Wood Mackenzie’s Senior Analyst
See Also:
- JLR to use old I-PACE batteries as energy storage system in the UK
- Tesla dominates YTD global energy storage deployment in H1 2023
- Dual carbon goal supports growing energy storage sector in Chin
- Tesla enjoys enormous growth in its energy storage deployments in Q1 2023
- Gotion joins Edison Power in penetrating Japan’s energy storage market
The Energy Department disclosed on Friday plans to invest up to $325 million across 15 different energy storage projects in 17 US states and one tribal nation. The government expects this effort to boost the long-duration energy storage (LDES) development and reduce costs by 90% this decade.
