The overall capacity of energy storage – excluding reversible hydroelectric plants – will increase by almost 1 TW between 2024 and 2033, which will represent an increase of 636%. Tax incentives and hybrid auctions will accelerate the expansion of technology around the world.
According to the consultancy wood mackenzie, in its latest report released this week, this makes the technology one of the fastest growing markets in the energy industry, as the challenges of integrating renewable sources increase.
“The global deployment of energy storage in 2023 achieved record growth of 162% compared to 2022, installing 45 GW/100 GWh. While impressive, the growth represents just the beginning for a multi-TW market […],” said Anna Darmani, principal energy storage analyst at the consultancy.
Still according to Wood Mackenzie, the global storage market must reach 159 GW/358 GWh until the end of 2024.
China will continue to lead the energy storage market due to the growing number of photovoltaic installations, with an average of 42 GW/120 GWh of annual growth until 2033.
In Europe, large-scale projects are growing as developers seek to seize revenue opportunities. Demand from the distributed segment decreased by 23% in 2024, as retail rates stabilize. With lower system costs and regulatory changes, however, distributed market growth is expected to resume from 2026.
Expansion of renewable energies
The growth of energy storage accompanies the advancement of renewable energies, due to the need to provide flexibility to electrical systems.
From 2024 to 2033, developers estimate adding 5,4 TW of new solar and wind capacity. As a result, the accumulated global total will reach 8 TW at the end of the cycle. This movement reflects efforts to electrify economies and achieve decarbonization goals.
A global forecast for solar energy points to an addition of 3,8 TW in the next 10 years, compared to 1,6 TW of wind power. China will for 50% of solar energy growth.
“Ultimately, maximizing solar PV capacity and wind capacity in this case over the next 10 years will depend on additional technological developments: from expanding grid infrastructure to encouraging flexibility, transportation and heating electrification solutions,” said Juan Monge, principal solar photovoltaic analyst at Wood Mackenzie.
By 2023, dramatic drops in Chinese module prices and tight deadlines for interconnecting tendered projects have triggered 150% annual growth for installations across all solar PV segments.
Annual increases in annual installed solar capacity will continue until 2026, when Wood Mackenzie forecasts a two-year slowdown due to an expected pause in development activity before the next round of acquisition drives greater deployment.
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