Battery energy storage systems (BESS) are crucial in enabling the energy transition. Their deployment is essential to providing electricity systems' flexibility to support higher electrification, relying primarily on variable renewable energy (RE) sources. At the behind-the-meter (BTM) level, batteries are also increasingly recognized as a critical technology for end users to maximize on-site RE generation, manage energy demand more efficiently, control costs, and reduce carbon footprint.
BESSs have entered a period of accelerated growth. Global annual deployments are set to expand at a 30.5% CAGR from 2023 to 2035, reaching 240.63 GW with 1.69 TW of cumulative capacity. Capacity deployments will be led by grid-scale batteries, accounting for between 70-80% of new capacity. While short-mid opportunities remain concentrated in China, North America, and Europe, by 2035, India and South Asia; East Asia; Australia, New Zealand, and the Pacific; and Latin America will have become attractive destinations for BESS investments.
The solar and battery low-price scenario, the push for domestic content, electric mobility, and higher transparency on ESGs are injecting extra dynamism into the market and new opportunities for differentiation. As the industry matures and batteries prove to be the right fit for a wide range of applications, the focus is on increasing efficiency, profitability, and sustainability. Numerous AI and analytics-based solutions are transforming the market, bringing gains in battery performance, manufacturing efficiency, trading, energy optimization, and circularity.
This Frost & Sullivan analysis provides a regional-level forecast and examination of how BESS capacity and investments will evolve by 2035 split by end-user segment. It discusses the main drivers and trends in supply, technology, business models, and use cases. In addition, it highlights growth opportunities for industry participants.
Author: Maria Benintende
Scope of Analysis
Regional Segmentation
End-user Segmentation
Applications by End User
Application Definitions for
Application Definitions for Residential and C&I BESSs
Why is it Increasingly Difficult to Grow?
The Strategic Imperative 8™
The Impact of the Top 3 Strategic Imperatives on the BESS Industry
Key Findings
Key Trends Shaping the BESS Industry
Trend 1—AI Revolutionizing the BESS Value Chain
Trend 2—Carrots and Sticks to Foster BTM Self-consumption
Trend 3—VPPs to Unlock Extra Value from BTM Storage
Trend 4—Solar-plus-storage, the Perfect Match for Both Sides of the Meter
Trend 5—Alternatives to Lithium
Trend 6—Batteries Supporting Transport Electrification
Trend 7—Higher Transparency and ESG Accountability for Batteries
Trend 8—Predictive BESS Analytics
Growth Metrics
Growth Drivers
Growth Restraints
Key BESS Suppliers
Forecast Considerations
Cumulative Storage Capacity Growth
Cumulative Power Capacity Growth
Annual Power Capacity Forecast
Annual Storage Capacity Forecast
Capex Capacity Forecast
Capacity Forecast Analysis
Pricing Trends and Forecast Analysis
Regional Analysis—North America
Regional Analysis—Europe
Regional Analysis—ANZ and Pacific
Regional Analysis—China
Regional Analysis—East Asia
Regional Analysis—India and South Asia
Regional Analysis—ASEAN
Regional Analysis—Latin America
Regional Analysis—Middle East and North Africa
Regional Analysis—Sub-Saharan Africa
Regional Analysis—Russia and CIS
Growth Opportunity 1: Solar-plus-storage Retrofits
Growth Opportunity 1: Solar-plus-storage Retrofits (continued)
Growth Opportunity 2: BESS to Fuel Electric Transportation
Growth Opportunity 2: BESS to Fuel Electric Transportation (continued)
Growth Opportunity 3: Energy Storage-as-a-Service
Growth Opportunity 3: Energy Storage-as-a-Service (continued)
Growth Opportunity 4: AI and Advanced Analytics-based Platforms for BESS Optimization
Growth Opportunity 4: AI and Advanced Analytics-based Platforms for BESS Optimization (continued)
Growth Opportunity 5: Grid-scale BESS to Shape Renewable Energy Power Purchase Agreements
Growth Opportunity 5: Grid-scale BESS to Shape Renewable Energy Power Purchase Agreements (continued)
Benefits and Impacts of Growth Opportunities
Action Items & Next Steps
List of Exhibits
List of Exhibits (continued)
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| Deliverable Type | Market Research |
|---|---|
| Author | Maria Benintende |
| Industries | Energy |
| No Index | No |
| Is Prebook | No |
| Keyword 1 | Battery Energy Storage Systems |
| Keyword 2 | Sustainable Energy Storage |
| Keyword 3 | Grid Energy Solutions |
| Podcast | No |
| Predecessor | MGDE-01-00-00-00 |
| WIP Number | MH99-01-00-00-00 |
Growth Opportunities in the Battery Energy Storage Systems Industry
Advanced Digital Technologies are Driving Transformational Growth for Front- and Behind-the-meter Applications
18-Nov-2024
Global
Market Research