Batteries for Solar Energy Storage Market

Batteries for Solar Energy Storage Market Size

Batteries for Solar Energy Storage Market is anticipated to exhibit a Compound Annual Growth Rate (CAGR) of 20.3% during the forecast span from 2024 to 2034. In 2023, the market size was assessed at USD 21.2 billion and is projected to reach USD 162.1 billion by the completion of 2034.

Batteries for solar energy storage are designed to save extra electricity produced by solar panels during times of brighter sunlight for later use. These systems allow residences and commercial establishments to make use of solar energy even when there is no sunlight, for instance at nighttime or during heavy cloud cover. In addition, the most frequently seen variations of solar energy storage batteries are lithium-ion batteries, which are the ones found in electric cars, due to their high energy content and extended durability. Moreover, while lead-acid batteries offer a more affordable option, emerging technologies such as flow batteries and solid-state batteries are gaining importance in the solar energy storage industry. These storage setups consist of a battery, an inverter that changes DC power to AC, and a charge controller that controls the movement of power. Thus, batteries are important for promoting the adoption of solar energy as a primary source of power by providing a constant supply of electricity.

Market Highlights

Batteries for Solar Energy Storage Market is expected to grow at a compound annual growth rate (CAGR) of 20.3% from 2024 to 2034

Batteries for the solar energy storage market are projected to reach USD 162.1 billion over the forecast period, due to the growing acceptance of renewable energy and the need for energy self-sufficiency. Due to the excellent efficiency and low cost of lithium-ion batteries, the market for solar energy storage batteries is becoming increasingly competitive. In the housing market, there is a clear trend of rising popularity as homeowners are integrating solar panels with battery setups. This pattern further holds for utility-scale and commercial storage projects, which often combine solar energy with the installation of sizable batteries. In addition, there is a substantial focus on integrating intelligent energy management systems into these storage solutions. Besides, in numerous countries, government incentives and policies are boosting the growth and innovation in this sector.

Source: Fatpos Global

Batteries for Solar Energy Storage Market Segmentation

Lithium-Ion Battery segment will lead the market as its unique characteristics and better features

Batteries for the solar energy storage market are divided by Battery into Lead Acid, Lithium-Ion, Nickle Cadmium, and Others. In the batteries for solar energy storage market, the lithium-ion segment is dominating due to the superior characteristics of lithium-ion batteries, such as high energy density and faster charging capabilities. They provide a better depth of discharge and require less maintenance than lead-acid batteries. In addition, the declining cost of lithium-ion batteries, as a result of innovations in technology has greatly contributed to their market leadership. These batteries are highly suitable for various applications from small residential systems to large utility-scale projects. Furthermore, the shift of the automotive industry towards electric vehicles has accelerated the production of lithium-ion batteries, which led to cost reductions that benefit the solar storage market.

On-Grid segment will dominate the market due to its large usage in residences and industries

Batteries for the solar energy storage market are divided by Connectivity into Off-Grid and On-Grid. The on-grid segment is dominating the solar energy storage batteries market due to the large use of grid-connected solar systems in homes and factories. On-grid systems allow users to take advantage of net metering regulations, which allows surplus energy to be sent back to the grid, thereby resulting in cost reduction. These systems also provide more dependability by being able to access power from the grid when solar generation or battery storage is inadequate. Moreover, on-grid systems are typically more cost-effective and simpler to set up compared to off-grid systems, since they do not require achieving full energy autonomy. They are well-liked in urban and suburban areas that have existing grid infrastructure. Besides, being able to connect with smart grid technologies and take part in grid services makes on-grid battery storage systems even more attractive.

Source: Fatpos Global

Market Dynamics

Growth Drivers

Declining Costs and Increasing Efficiency to Drive Growth in the Batteries for Solar Energy Storage Market

Batteries for the solar energy storage market are growing significantly as costs continue to fall, combined with improving efficiency. Manufacturing methods are becoming highly advanced, and as a result the cost of battery systems, such as lithium-ion batteries, is declining. Additionally, improvements in the chemistry and design of batteries are extending the lifespan of these systems. These elements come together to improve the cost-efficiency of solar-plus-storage options, which makes them more appealing to customers and companies. Furthermore, growing economic feasibility is leading to the adoption in multiple industries, from home installations to big utility projects. Thus, with the improvement in the return on investment, more stakeholders are motivated to integrate battery storage with their solar energy systems.

Growing Renewable Energy Integration Act as a Catalyst for Market Growth

Global shift to clean energy sources is a major factor influencing the market for solar energy storage batteries. Nations and organizations are pledging to lower their carbon emission, due to which the share of renewable energy in the global power mixture is quickly growing. However, the irregularity of solar and wind energy creates difficulties in maintaining grid stability and ensuring a steady supply of energy. Battery storage systems provide a solution by storing extra energy produced during high production times for use when renewable sources are not generating power. This feature allows for the creation of a renewable energy grid that is more reliable and stable. Furthermore, with global renewable energy goals becoming more ambitious, the demand for battery storage is projected to increase.

Restraints

Raw Material Supply Constraints in the Batteries for Solar Energy Storage Market Will Impact the Growth

Although there are positive factors that contribute to the growth, the solar energy storage battery market is facing a major obstacle due to limitations in the supply of raw materials. The manufacturing of batteries depends on certain materials like lithium, cobalt, nickel, and rare earth elements. The supply chains for these minerals are usually concentrated in certain locations, which makes them vulnerable to geopolitical tensions and environmental difficulties within those countries. Furthermore, changes in the availability of raw materials can have a direct impact on the production costs of batteries. This restriction highlights the importance of studying different battery chemicals and materials, along with the need for more resilient supply networks. Therefore, it is essential to tackle these supply challenges to ensure the sustainable long-term development of the solar energy storage market.

Recent Developments

• In 2023, Tesla announced the Powerwall 3, an upgraded version of its popular home battery system. The Powerwall 3 features increased power output and a more compact design. Tesla also expanded its virtual power plant projects, allowing Powerwall owners in select regions to participate in grid services and earn money by sharing their stored energy during peak demand periods.
• LG Energy Solution introduced its new residential battery storage system, the RESU Flex, in late 2022. This modular system allows for customizable capacity to meet varying energy needs.
• Enphase launched its IQ Battery 5P in 2023, featuring improved energy density and a faster charging rate compared to previous models. The company also expanded its microinverter-based energy storage systems to new international markets, focusing on regions with high solar adoption rates.
• SolarEdge introduced its Energy Bank residential battery in more markets globally throughout 2023. The company also enhanced its energy management platform, allowing for better integration between solar production, battery storage, and home energy consumption.
• Generac expanded its PWRcell battery system line with new high-capacity models in 2023. The company has been focusing on integrating its battery storage solutions with its traditional backup generator business, offering hybrid systems for enhanced energy resilience.

Batteries for Solar Energy Storage Market

Key Players:

• Tesla, Inc.
• LG Energy Solution
• Panasonic Corporation
• BYD Company Limited
• Samsung SDI Co., Ltd.
• Sonnen GmbH
• Enphase Energy, Inc.
• Generac Power Systems, Inc.
• SolarEdge Technologies, Inc.
• ABB Ltd.
• Eaton Corporation
• Huawei Technologies Co., Ltd.
• Sungrow Power Supply Co., Ltd.
• Delta Electronics, Inc.
• NEC Energy Solutions, Inc.
• Other Prominent Players (Company Overview, Business Strategy, Key Product Offerings, Financial Performance, Key Performance Indicators, Risk Analysis, Recent Development, Regional Presence, SWOT Analysis)

Regional Analysis

Batteries for Solar Energy Storage Market is segmented based on regional analysis into five key regions: North America, Latin America, Europe, Asia Pacific, and the Middle East and Africa. The Asia Pacific region is leading the solar energy storage market due to various reasons. China, Japan, and South Korea are at the forefront of battery technology production, owing to their well-developed supply chains and affordable manufacturing costs. The industrial growth and urban expansion in the area have further raised the energy demand, which results in the use of renewable energy sources.

Meanwhile, North America is set to experience major growth in the next ten years. This trend is due to the growing awareness of climate change and the low prices of solar-plus-storage systems. Furthermore, the high incidences of severe weather events are raising the need for strong power systems in residential and commercial areas, where solar energy storage batteries play a major role.

Source: Fatpos Global

Impact of COVID-19 on the Batteries for Solar Energy Storage Market

batteries for the solar energy storage market initially faced disruptions due to the COVID-19 pandemic, which resulted in delays in installations. In addition, temporary shortages and price fluctuations were caused due to manufacturing slowdowns in China. However, the market displayed strength and flexibility. As the economies reopened, there was a rise in residential solar-plus-storage installations due to higher energy usage across households during lockdowns and high demand for energy self-sufficiency. This market rebound was supported by this policy backing, along with continuous decreases in the cost of battery technology. Therefore, the crisis highlights the significance of energy security and independence, which increased the attention towards solar energy storage options in residential and utility industries.

Batteries for Solar Energy Storage Market is further segmented by region into:

• North America Market Size, Share, Trends, Opportunities, Y-o-Y Growth, CAGR – United States and Canada
• Latin America Market Size, Share, Trends, Opportunities, Y-o-Y Growth, CAGR – Mexico, Argentina, Brazil, and Rest of Latin America
• Europe Market Size, Share, Trends, Opportunities, Y-o-Y Growth, CAGR – United Kingdom, France, Germany, Italy, Spain, Belgium, Hungary, Luxembourg, Netherlands, Poland, NORDIC, Russia, Turkey, and Rest of Europe
• Asia Pacific Market Size, Share, Trends, Opportunities, Y-o-Y Growth, CAGR – India, China, South Korea, Japan, Malaysia, Indonesia, New Zealand, Australia, and Rest of APAC
• Middle East and Africa Market Size, Share, Trends, Opportunities, Y-o-Y Growth, CAGR – North Africa, Israel, GCC, South Africa, and Rest of MENA

Batteries for Solar Energy Storage Market Scope and Segments:

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