Energy storage as a service (ESaaS) utilizes batteries to store energy from renewable sources like solar and wind for use during peak demand periods or power outages. Batteries can capture surplus renewable energy production and store it for later usage. ESaaS offers energy storage capacity on demand rather than requiring upfront investment in hardware assets. It allows customers to avoid high upfront capital costs and instead pay a subscription fee for the storage capacity and services provided. The global energy storage market operates on a 'pay as you use' model delivered through utility programs, reducing theTotal Cost of Ownership (TCO) for customers.
The Global Energy Storage as a Service Market is estimated to be valued at US$ 1.81 Bn in 2024 and is expected to exhibit a CAGR of 10.8% over the forecast period 2024-2031.
Key Takeaways
Key players operating in the Energy Storage as a Service are Tesla, Dynapower, Greensmith Energy, Stem, Enervenue, Green Charge Networks, NEC Energy Solutions. Second paragraph is talking about the key growing Energy Storage as a Service Market Growth and third paragraph is talking about technological advancement of market.
Key players operating in the energy storage as a service market include Tesla, Dynapower, Greensmith Energy, Stem, Enervenue, Green Charge Networks, and NEC Energy Solutions. As battery prices continue to fall, more commercial and industrial customers are able to adopt energy storage solutions.
Projects like virtual power plants are also driving demand for distributed energy resources. Advancements in battery chemistries like lithium iron phosphate and vanadium redox flow batteries have improved the cycle life and safety of energy storage technologies.
Market trends
Long duration energy storage is gaining more traction as it allows storing excess renewable energy for extended periods. Projects ranging from 4-10 hours are becoming common. Secondly, hybrid energy storage solutions combining batteries with other technologies like pumped hydro are being deployed to maximize the overall energy throughput of storage assets.
Market Opportunities
Widespread electrification of transportation and the need for EV charging infrastructure will spur demand for distributed energy storage. Integrating storage with solar+wind projects provides opportunities for round-the-clock renewable energy supply. falling cost of batteries is also expanding opportunities for behind-the-meter storage for commercial and industrial customers looking to optimize their energy costs.
Impact of COVID-19 on Energy Storage as a Service Market Growth
The global COVID-19 pandemic has significantly impacted the growth of the energy storage as a service market. During the initial stages of the pandemic in 2020, many countries announced complete lockdowns to curb the spread of the virus. This led to a steep decline in industrial and commercial activities globally. As energy storage services majorly cater to industrial and commercial sectors, the demand from these sectors reduced drastically. This was reflected in the market's growth rate, which declined from its pre-COVID projected CAGR of over 10%.
However, with the rollout of vaccination drives in 2021, industrial and commercial operations resumed gradually. This provided some recovery for the energy storage as a service market. Many energy service providers also adopted work from home and hybrid work models to sustain operations during lockdowns. They enhanced their online and remote service capabilities to continue serving existing customers. On the supply side, battery manufacturers faced issues like disruption of raw material supply chains and reduced workforces at production units in 2020 that pulled down battery supplies.
Going forward, the market is projected to pick up pace again as economic activities normalize fully. Increased investments are expected in large-scale energy storage projects to strengthen power infrastructure and facilitate the integration of renewable energy sources. Growth may also be driven by heightened focus on decarbonization goals and rising self-consumption of solar energy by commercial and industrial prosumers. However, risks of potential future pandemic waves pose challenges. Sustained recovery would require concerted global efforts to minimize economic disruptions.
The North American region currently holds the largest share of the global energy storage as a service market in terms of value. This is attributed to extensive investments in scaling up energy storage capacities to modernize the power sector and meet decarbonization targets. Countries like the US and Canada have announced ambitious renewable energy deployment plans that involve large-scale battery storage installations. Subsidy schemes and conducive regulatory frameworks are also attracting significant capital in this region for energy storage services.
The Asia Pacific region is poised to emerge as the fastest growing regional market during the forecast period. Rapid industrialization and urbanization coupled with growing power demands in densely populated countries such as China and India will drive the need for modernizing aging power infrastructure with storage solutions. Additionally, aggressive renewable integration programs in the wake of sustainability goals across the region are presenting substantial opportunities. Declining battery costs are also making storage economical for businesses and industrial facilities.
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