Report: C&I storage could be $10.8B market by 2025

Dive Brief:

Energy storage in the commercial and industrial areas is poised for growth over the next decade, with Navigant now predicting revenues from the sector will reach $10.8 billion by 2025.
The largest growth will be in the industrial building segment, which the firm expects will deploy 9.3 GW of storage capacity in the next 10 years. Office buildings and educational facilities will follow with large deployments as well, the report noted.
The report, "Market Data: Commercial & Industrial Energy Storage," focuses on advanced lead-acid, flow, and lithium ion batteries.

Dive Insight:

As energy storage prices fall, understanding of the technology grows and more batteries are installed behind the meter, Navigant Research expects revenues from the sector to significantly rise over the next decade. A new report finds annual revenue for the C&I energy storage industry is expected to grow from $968.4 million in 2016 to $10.8 billion by 2025.

“Despite early challenges, global C&I ESS power capacity deployments are expected to grow from 499.4 MW in 2016 to 9.1 GW in 2025,” Alex Eller, research analyst with Navigant Research, said in a statement. “The industrial building segment is expected to be the largest, deploying an estimated 9.3 GW of cumulative new capacity over the coming decade, followed by the office and education building segments.”

Navigant noted that the landscape of vendors offering C&I energy storage systems "is growing increasingly diverse and competitive," with a variety of marketing angles and partnerships moving the technologies into the field. An older guard of building energy management providers are also competing with startups in the market Navigant said, "to offer compelling solutions for various customers."

But despite recent growth, C&I storage is in the early stages of development globally. And Navigant identified several ongoing challenges to the sector, including poor understanding and undervaluation by stakeholders. "However, regulatory reforms and technological advances are expected to help bring C&I energy storage into the mainstream," Navigant concluded.

Though utility-scale storage systems often provide one specific service to the grid, "many C&I systems will need to be more flexible," Navigant found. A commercial or industrial storage system could be required to discharge at high power for for a half hour to shave peak demand, but also provide backup power or participate in a 4-hour demand response event.

"This need for flexibility has driven some vendors to offer hybrid systems, including multiple technologies to meet both power- and energy-centric building needs efficiently," the report said.