Why is Need for Distributed Energy Storage Systems Growing?
Distributed energy storage systems help balance the supply of power and demand on a grid. It can be installed on land, offshore, or underground. These energy storage systems and are connected to a high-voltage power network through a series of transformers. These transformers reduce the voltage so that more power can be transferred over longer distances.
Distributed energy storage is an essential element of an energy system modernization strategy. It can allow a greater reliance on renewables, while offering significant climate benefits. Furthermore, it can also support smart grids and help balance the generation and demand across a grid.
The global energy storage market is characterized by three main technology segments: Thermal Energy Storage Systems, Mechanical Technology, and Electro Chemical Technology. The Thermal Storage Technology segment is expected to grow at a CAGR of 9.2% over the forecast period of 2022-2027.
The global energy demand has been increasing at an exponential pace. Buildings alone are responsible for 30% of the world’s energy usage. The investment required to meet this demand will increase to $2 trillion a year by 2035.
What’s Driving Demand for Distributed Energy Storage Systems in the United States?
According to the Energy Information Administration (EIA), the United States generated 826 TWh of electricity from renewable sources. Furthermore, a total of 163 energy storage devices with a storage capacity of 1,688 MWh were deployed throughout the country.
The country’s central and municipal governments have enacted various restrictions and provided incentives, encouraging the population’s adoption of electric vehicles.
The rising use of renewable energy sources for power generation will boost the market for distributed energy storage systems in the United States. As a result, the market for battery energy storage systems in the United States is estimated to reach US$ 2.6 billion by 2032.
What is the Current State of the China Distributed Energy Storage System Market?
China is the world’s most populous country. Increased population leads to increased urbanization and industry, which increases energy demand dramatically. China began employing distributed energy storage systems in 1998, and these systems have grown fast since then due to the country’s high energy demand and environmental challenges.
China’s 14th five-year plan prioritizes energy security, followed by environmental development and decarburization. China intends to create 1,200 GW of electricity from renewable sources such as solar and wind by 2025, with non-fossil fuels accounting for 25% of total energy consumption by 2030.
According to statistics, China’s investments in renewable energy production in the next few years will account for 30% of global investments.These elements will enable the long-term expansion of the Chinese distributed energy storage system industry, which is estimated to provide a US$ 1.2 billion absolute dollar potential by 2032.