Energy Storage Market Expected to Peak in the Next 20 Years
The energy storage market has been steadily growing, but experts predict that it will soon reach its peak within the next twenty years. This trend is known as the “S curve” and is expected to be influenced by various factors.
One of the main reasons for this peak is the oversupply and commoditization of electric cars, which currently make up the largest market for energy storage. With the increasing popularity of electric cars, especially in China where they are now being sold at a discounted price of $10,000, the demand for batteries is expected to decrease in the future. Additionally, the battery life of electric cars has improved, reducing the need for replacements.
Furthermore, economists predict a potential collapse of the Chinese economy, which would further decrease the price of Chinese cars and their batteries. This has led to countries like the USA planning to impose 100% tariffs on Chinese-made electric cars. However, this may lead to other countries offering electric cars at a discounted price, resulting in a decrease in the overall demand for batteries.
In the next 20 years, the energy storage market will face another hit from the rise of energy-independent mobile electronics. With the advancement of technology, on-board multi-mode energy harvesting and Simultaneous Wireless Information and Power Transfer (SWIPT) is expected to reduce the need for energy storage in mobile devices.
Despite these potential challenges, the energy storage market is still expected to grow, especially in the power sector. This year, the G7 committed to a global goal of increasing energy storage in the power sector to 1500 GW in 2030, which is more than six times the current capacity. This aligns with the COP28 global goal of tripling renewable energy capacity by 2030 and transforming intermittent energy into reliable baseload power. Other organizations such as the G20 and COP29 are also expected to follow suit.
With the power sector becoming the largest market for energy storage, electric vehicles will no longer hold this title. Instead, stationary storage, which is currently used for short-term battery storage, is expected to become the main market for energy storage. This is due to the increase in Long Duration Energy Storage (LDES) for grids and other off-grid applications.
Technologies such as pumped hydro, gravity storage, and compressed air storage are expected to dominate the LDES market. These technologies have a longer lifespan and can provide one-tenth of the levelized cost of storage compared to other forms of energy storage.
Eventually, even homes with solar panels will be able to compensate for solar dead zones at night and on dull days. This, coupled with the trend of data centers, desalination plants, and industrial processes becoming energy independent, will lead to a significant demand for off-grid LDES.
As for the future of LDES, experts predict that it will eventually saturate due to minimal replacement businesses and the rise of alternative energy sources. This may be due to the reduced need for batteries as wind and solar power become less dominant and other alternatives such as ocean wave and geological power become viable.
In conclusion, the energy storage market is expected to peak in the next 20 years, with the power sector becoming the largest market for energy storage. However, with the rise of alternative energy sources and the potential saturation of the LDES market, the growth of the energy storage market may slow down in the future. To learn more about the energy storage market and its future, you can refer to the Zhar Research reports available at www.zharresearch.com.
Derick is an experienced reporter having held multiple senior roles for large publishers across Europe. Specialist subjects include small business and financial emerging markets.