Unprecedented vitality storage development predicted in Wooden Mac’s Q3 U.S. Vitality Storage Monitor
According to Wood Mackenzie and the latest US Energy Storage Monitor (ESA) report from the US Energy Storage Association (ESA), 476 megawatts (MW) of storage were deployed in the third quarter of 2020. This corresponds to an increase of 240% compared to the high set in the last quarter. As the study found, the new storage record is not an anomaly, but a sign of the future as front-of-the-meter (FTM) storage procurement increases dramatically in number and size, particularly in California.
While the residential segment also grew, the greatest growth was in the FTM market segment. In the third quarter nearly 400 MW and 578 MWh were used, which exceeded the previous records of 133 MW and 296 MWh for this sector. More FTM storage was installed in the third quarter than in any other segment in any of the other quarters over the past 7 years. Despite the relatively short duration of the systems deployed in this quarter, the FTM MWh deployments exceeded the previous record in the first quarter of 2017 by almost 200%.
Just the beginning. “Energy storage provision continues to grow despite the economic downturn and the COVID-induced slowdown,” said Kelly Speakes-Backman, CEO of the US Energy Storage Association. “The signs point to an unprecedented increase in energy storage in the coming months and bring us closer to achieving our vision of 100 GW by 2030. With continued political support and regulatory reforms at the state and federal levels, energy storage is poised to continue on this path, enabling a more resilient, efficient, sustainable and affordable power grid for all. “
The US battery storage storage market is projected to grow from 1.2 GW in 2020 to nearly 7.5 GW (and 26.5 GWh) in 2025, largely driven by the procurement of large utility companies. Solar-paired storage will make up a large portion of these installations, and possibly the vast majority, as developers seek to capture the value of the investment tax credit.
“These eye-catching deployment sums are just the beginning of a long-awaited upswing for the US storage market. Massive price drops and efforts to ensure eligibility have set the stage for exponential growth, and the curtain has only just come up on the first act. Given the size of the systems expected in 2021, we don’t expect this remarkable record to last for long, ”added Dan Finn-Foley, director of energy storage at Wood Mackenzie.
What about housing? The residential storage market has grown steadily for six quarters in a row, reaching 52 MW (119 MWh) in the third quarter of 2020, with resilience being the main driver. “Although the market for residential storage was around 7,000 deployments per quarter in 2020, the sector is expected to grow 6-fold by 2025, with increasingly active markets emerging in New York, Massachusetts, PJM, Texas and Florida, among others.
“The potential upward trend of landmark FERC Regulation 2222 could become apparent next year as market operators and utilities make plans to implement it. These decisions will affect where and how quickly storage companies will be able to center network services and the wholesale market in their strategic growth, ”said Chloe Holden, wood storage analyst at Wood Mackenzie.
Massachusetts continued its strong presence in the non-residential segment through its SMART program, beating Hawaii’s stake totals to take second place in that segment. Usage outside of residential areas has slowed in recent quarters, increasing by around 30 MW each quarter of this year, as opposed to the segment’s quarterly highs of more than 40 MW in the first and fourth quarters of 2019.