PV Storage Market To Hit $19 Billion By 2017, IMS Research Reports
Energy storage may be the next big thing in cleantech, and in the energy sector as a whole. We have never had much energy storage in place across the world. Instead, we have built a tremendous amount of backup capacity. With the variability of wind and solar, their increasingly low costs, and the desire to have a renewably powered world, the drive for cost-effective storage has picked up in pace. And many new solutions seem to be on the horizon. Furthermore, as the market expands, economies of scale allow the manufacturing costs to drop considerably.
A new report from IMS Research, which is part of IHS Inc, finds that the market will grow from under $200 million in 2012 to $19 billion by 2017. That’s quite explosive growth.
“Following the introduction of an energy storage subsidy in Germany, global installations of PV storage systems are forecast to grow by more than 100 percent a year on average over the next five years, to reach almost 7 gigawatts (GW) in 2017 and worth $19 billion,” IMS Research writes. “Germany will account for nearly 70 percent of storage installed in residential PV systems worldwide in 2013.”
Germany’s energy storage subsidy, which is starting on May 1 (tomorrow), may not be ideal, but it is certainly a start. “IHS predicts that the subsidy will promote rapid growth in the German residential sector, and result in almost 2 gigawatt-hours (GWh) of effective storage capacity being installed during the next five years.”
The reason storage in Germany is looking so promising, beyond the storage incentive, is that the feed-in tariff for solar power has gotten so low that it is lower than residential electricity rates. So, a homeowner saves more money by using solar power on location than selling it. But because the sun doesn’t shine for the full time that we use electricity and many people generate more electricity than they need when it is shining, if energy storage is cheap enough, it becomes more sensible to store what one generates in the daytime for use later in the evening.
Even without the coming subsidy, 8 MW of solar power were installed with storage in 2012.
IMS Research adds: “the proposed subsidy will reduce the average 20-year cost of a PV system with storage to 10 percent less than a system without it.”
IMS Research expects other countries to follow Germany’s lead, as they did with solar power feed-in tariffs. And, of course, with falling battery costs, the incentives won’t even be needed to spur on a great deal of market growth.
“Even without subsidies though, storage can be an attractive proposition in conjunction with residential PV systems in some markets, such as the U.K., where the market is forecast to begin growing quickly in 2014, when the price of batteries is predicted to have fallen sufficiently to make PV storage financially viable,” said Sam Wilkinson, PV analyst at IHS.
As for the non-residential market, by the way, IMS Research sees it growing substantially as well. It projects that utility-scale PV systems with storage will grow by 2 GW annually by 2017.