Dive Brief:
- The U.S. grid-scale and residential energy storage market segments set deployment records in the third quarter of this year and were the bulk of 3,806 MW/9,931 MWh installed in the July-September period, the American Clean Power Association and Wood Mackenzie said in their U.S. Energy Storage Monitor report published Thursday. The totals represent 80% and 58% increases over year-ago deployments, they said.
- Grid-scale deployments exceeded 3.4 GW and 9 GWh, while residential deployments reached 346 MW/645 MWh, according to the report. Energy storage growth, particularly utility-scale, is being driven by the California and Texas markets.
- California continued its support for energy storage this week. The California Energy Commission on Wednesday approved a $42 million grant to build a long-duration energy storage project at Marine Corps Base Camp Pendleton in San Diego County.
Dive Insight:
A variety of system and economic benefits are driving widespread adoption of energy storage, say market observers.
“We have seen consistent growth in the market this year, especially in the grid-scale segment,” said Nina Rangel, senior research analyst at Wood Mackenzie. “Overall, storage installations will grow 30% in 2024, signaling the industry’s strongest year yet. However, it will be difficult to keep this pace.”
Between 2025 and 2028, Wood Mackenzie is projecting an annual average growth rate of 10%, as early-stage development constraints continue, Rangel said.
Texas and California both saw “robust” deployments of grid-scale storage, the groups said. Texas tripled installations compared to the second quarter, with nearly 1.7 GW added, and California added nearly 6 GWh “thanks to its focus on longer duration plants.”
The Pendleton project reflects the growing focus on storage installations capable of providing power for longer periods of time.
“Long-duration and multi-day energy storage technologies will help California achieve its clean energy goals by enhancing how we store power generated by renewable resources,” CEC Chair David Hochschild said. “This landmark energy storage project continues a long collaboration between the Energy Commission and the military.”
The project will initially provide 6 MW/48 MWh of storage using zinc hybrid cathode aqueous battery technology, with plans to expand the resource to 50 MW/400 MWh. The system will be able to support the California grid when batteries are not providing backup power to the base, the CEC said. It is expected to be operational in 2027.
Arizona, Colorado, Florida, and Vermont also deployed large battery installations, “showing an appetite for grid-scale storage deployment across the country,” ACP and Wood Mackenzie said.
“We are seeing the energy storage industry fill a real need across the country to provide reliability in an affordable and efficient manner for communities,” said ACP Senior Vice President of Markets and Policy Analysis John Hensley. “With 64 GW of new energy storage expected in the next four years, the market signal continues to be clear that energy storage is a critical component of the grid moving forward.”
California, Arizona and North Carolina led third quarter growth in the residential segment, installing 56%, 73% and 100% more than in the second quarter despite battery supply shortages, according to ACP and Wood Mackenzie.
Community-scale, commercial and industrial storage installations fell 4% from a year ago to 29 MW, the groups said.
