Solar Energy Storage Market Size, Share & Growth, Report 2031

Report Description

Solar Energy Storage Market Outlook 2031

The global solar energy storage market size was valued at USD 10.57 Billion in 2022 and is projected to reach USD 20.95 Billion by 2031, expanding at a CAGR of 7.9% during the forecast period 2023 - 2031. The growth of the market is attributed to increasing demand for renewable energy source due to environmental concerns and strict government regulations to limit emission of greenhouse gases across the globe. Moreover, the depletion in the fossil reserves globally is anticipated to propel the market growth.

Solar energy storage refers to the storehouse for the energy produced by solar connected grid for future use. This storage device is also utilized for the generation and management of the solar energy reserved in its battery. The reserved energy can be used when there is shortage of energy or when the external power supply fails to meet the requirement of users.

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These devices are available in various capacities and compositions that offer different range of storage volume and battery capacities. Rapid introduction of advanced technology and rising R&D activities are creating opportunities for new entrants and emerging players to diverse their product portfolio.

One key aspect for the significant growth rate of the market is due to wide adoption of these storage devices in both commercial and residential sector over the years. Surge in electricity consumption globally present a key concern for environment regulators and the agencies have been encouraging users to shift their focus from conventional energy source to renewable energy.

According to International Renewable Energy Agency (IREA), the solar photo voltaic (PV) is anticipated to fulfill 25% of the total electricity requirements. Over the recent years, the solar energy market is rapidly growing due to certain development especially due to the global environment regime change.

As per the resolution of the COP21 or 2015 Paris Climate Conference, government across the globe have implemented policies to restrict carbon footprint, which resulted in the exponential growth of the green bond industry, increasing investment in the large scale renewable projects, and boosting the electrification of the automotive industry worldwide.

Solar Energy Storage Market Trends, Drivers, Restraints, and Opportunities

• Stringent environmental regulations and policies across the globe to curtail carbon emissions is anticipated to boost the solar energy storage market growth during the forecast period.
• Growing demand for electric vehicles to reduce the transportation costs and prevent environment degradation has driven to raise the demand for energy storage units across the globe.
• Rising investment from auto manufacturers and companies involved in building charging stations are integrating solar energy storage devices with electric charging stations, which is anticipated to foster the growth of the market in the coming years.
• Rapid restructuring of the present-day energy infrastructure and integration of sustainable electrical infrastructure to boost the integrated energy conversion are expected to proliferate the solar energy storage market growth during the forecast period.
• State government bodies initiatives to integrate the conventional electricity sources with solar power houses for residential use is another key driving factor for the growth of the market.
• Lack of awareness about solar energy storage devices and slow transition process to renewable energy sources in emerging economies are expected to hinder the market growth.
• Technological advancements and presence of government subsidiaries to establish a healthy competition between the solar producers are speculated to positively impact the industry.
• Increasing number of players that offer various innovative energy storage solutions is expected to help in the expansion of the market.
• Rising number of small and medium companies that are integrating energy storage devices to their existing solar power projects are creating lucrative opportunities for the solar energy storage market expansion.

Scope of Solar Energy Storage Market Report

The report on the global solar energy storage market includes an assessment of the market, trends, segments, and regional markets. Overview and dynamics have also been included in the report.

Solar Energy Storage Market Segment Insights

Lithium-ion segment to exhibit a high CAGR

Based on compositions, the market is segmented into lithium-ion, lead acid, flow batteries, and others. The lead acid segment accounted for a large market share in 2022 and is anticipated to grow at a robust CAGR during the forecast period. Wide adoption of the lead acid battery in both on-grid and off-grid energy systems present a key aspect for the segment growth.

These batteries are extensively adopted across various industry verticals owing to certain benefits such as cost-effectiveness, substantial current capability, tolerant of overcharging, availability in wide range of specifications and sizes, and presence of many manufacturers. However, factors such as lower energy density, poor weight to energy ratio, toxic to the environment, and slow charging are some key challenges for the segment growth.

On the other hand, the lithium-ion segment is anticipated to exhibit a high CAGR during the forecast period owing to its rising demand from various industries. Lead acid batteries are increasingly getting replaced by lithium-ion batteries in wide range of applications due to certain advantages such as high energy density, low self-discharge rate, low maintenance, and considerable environmental benefits.

For instance, in June 2019, Toyota deployed solar rooftops at its five facilities using lithium-ion battery solutions to extract maximum source of energy. Rising R&D activities in this segment is anticipated to reduce the cost of the lithium-ion batteries, which acts as a key driving factor for the segment growth. Increasing investment by major industry players to expand the production capacity and rapid growth of the electric vehicles (EVs) market are anticipated to create remunerative opportunities of the segment in the coming years.

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Above 10000 kW segment to account for a large market share

In terms of capacities, the solar energy storage market share is divided into up to 50 kW, 51 to 250 kW, 251 to 500 kW, 501 to 1000 kW, 1001 to 2500 kW, 2501 to 5000 kW, 5001 to 10000 kW, and above 10000 kW. The combined 2501 to 5000 kW and 5001 to 10000 kW segments are anticipated to account for a significant market share owing to the high adoption of the storage capacities from number of small and medium enterprises for various solar energy utilities.

Increasing number of incentive programs regarding the usage of solar energy systems to grid operators and distributors are driving the growth of the market segment. Additionally, the rising number of integrated battery energy storage (BES) owing to reducing costs of batteries, which allow the retrofitting of solar PV with solar energy storage are projected to boost the segment growth. On the other hand, the above 10000 kW segment is anticipated to account for a large market share owing to the growing adoption of the storage capacity from large enterprises and rising awareness about variable renewable energy (VRE) sources in emerging economies.

Moreover, the availability of “behind-the-meter” energy storage is expected to foster the market segment growth. Various government bodies are working on building large scale renewable projects to reduce the dependency on depleting fossil reserves. Existing declining tariff rates of the storage type present a key factor that help raising demand for solar energy storage devices with capacity of more than 10000 kW.

Off-grid segment to exhibit a robust CAGR

On the basis of installations, the market is bifurcated into on-grid and off-grid. The off-grid segment is anticipated to exhibit a robust CAGR during the forecast period owing to the increasing investment in the development of technology that offer cost-effective deployment of stand-alone and mini grids. Rapid rise in the number of innovations to station of the off-grid systems pave several opportunities for small and medium investors to increase their portfolio.

Growing awareness about the benefits of off-grid renewable energy solutions such as capability to store the solar power in batteries is driving the growth of the off-grid segment. On the other hand, the on-grid segment is anticipated to account for a large market share during the forecast period owing to rising preference for automatic integrated system for solar energy conversion.

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Market in Asia Pacific to expand at a high CAGR

Based on regions, the solar energy storage market is categorized as North America, Europe, Latin America, Asia Pacific, and Middle East & Africa. The market in Asia Pacific to expand at a CAGR of more than 35.3% during the forecast period,  owing to several solar energy development projects and initiatives taken by various governments in the region.

Rapid development of the automotive industry and establishment of several manufacturing units in the region are key driving factors for the regional market expansion. In February 2021, Nitin Gadkari, the Union Minister for Road Transport and Highways in India, announced that second phase of Faster Adoption and Manufacturing of Electric Vehicles (FAME) aimed to provide subsidies worth around USD 1.3 billion to over 1.5 million electric vehicles.

Thus, such government initiatives and deployment of fiscal incentives to electric car manufacturers and solar power producers are anticipated to boost the regional market growth. Moreover, increasing implementation of strict regulatory policies for sustainable environment, especially in emerging economies such as India and China, that are fostering the market growth in Asia Pacific.

North America accounted for a large market share in 2020 and is projected to hold a large market share during the forecast period owing to early adoption of latest renewable energy technology that lead to the rapid expansion of the solar energy storage market. Increasing number of companies investing in the electric vehicles and solar voltaic systems are boosting the growth of the market in the region.

In September 2019, the Los Angeles Department of Water and Power (LADWP) Board of Commission approved the policy to implement two large-scale solar systems that can capture and store energy to power more than 0.28 million houses. The tech giant, Apple announced a plan in April 2021 to build solar energy storage facility in California. The company claimed that the facility could store 240 MW of solar energy.

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