Demand for energy conservation is increasing and considering the depleting level of energy resources, numerous companies emphasize on efficient energy consumption techniques. Rising population coupled with increasing industrial activities are likely to raise the demand for battery energy storage systems during the forecast period. Battery energy storage systems have been increasingly utilized in the production of renewable energy sources such as solar cell, wind turbine.
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The battery energy storage system market has expanded considerably in recent years due to increasing demand for renewable energy sources. Some important applications of battery energy storage systems include electrification of grid and this requires large amount of renewable energy resources, thus contributing to the consistent increase in demand for battery energy storage system. Gradual advancement in energy storage technology leads to significant cost reduction and enhances the efficiency of battery energy storage system. This, in turn, is likely to boost its demand in the market during the forecast period.
Battery energy storage system requires substantial amount of space and infrastructure set up. The considerable installation cost and complexity in regulation for setting up proper infrastructure is estimated to restrain the potential growth prospect of the battery energy storage system market during the forecast period. During round trip inefficiencies considerable amount of energy is lost and this factors hinder the expansion potential of the market.
A battery energy storage system allows integration of renewable energy and fossil fuel sources. This system utilizes intermittent energy, which is projected to offer a growth opportunity for the market during the forecast period. Rural electrification has been a major agenda of the government and in emerging economies such as China and India this issue gets substantial government support. Battery energy storage systems have been majorly used in areas where grid power is very weak. Increasing application of renewable sources is estimated to propel the battery energy storage system market during the forecast period.
In terms of connection type, the battery energy storage system market can be segmented into On-grid and Off-grid. The battery energy storage system is a new method of generating and distributing power energy. Considering the present trend of using significant amount of renewable energy, the on-grid battery energy storage system segment held considerable share of the market, as this system install substantial storage capacity and gets legal support for required infrastructure.
Off-grid battery energy storage systems are majorly demanded by countries in the sunbelt regions where solar radiation is very high. Off-grid battery energy storage systems have been increasingly deployed in remote areas where electrification and efficient usage of renewable resources is a challenge.
In terms of application, the battery energy storage system market can be segmented into residential, transportation, non-residential, utility, and others. The transportation application segment held dominant share of the market due to increasing utilization of batteries in battery driven cars and plug-in hybrid electric vehicles. Different types of batteries such as lithium ion, Li-Ion polymer find maximum application in different types of vehicles. These lithium-ion based batteries are lightweight and are highly energy efficient, and thus, these factors boost the demand for battery energy storage systems in vehicles The residential segment is projected to expand rapidly during the forecast period due to government initiatives for supplying electricity to every single house. Increasing usage of solar power plants, wind energy in these batteries are also likely to drive the demand for battery energy storage system in the market during the forecast period.
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In terms of region, the battery energy storage system market can be segmented into North America, Europe, Asia Pacific, Middle East & Africa, and Latin America. Asia Pacific held a prominent share of the market due to the rise in number of housing units in the region, latest trend of using renewable energy, and significant number of industrial belts.
Key player operating in the global battery energy storage system market include ABB Ltd., General Electric Co., Tesla Motors Ltd, and Siemens AG.