On August 23, Fuji Keizai (Chuo-ku, Tokyo) announced the results of a survey of the global market for storage batteries for ESS (Energy Storage Systems) and stationary power storage systems. According to the report, the market is expected to expand to 11,522.4 billion yen in 2040, 3.4 times the level in 2023, and the capacity is about 700GWh.
Global Market for Storage Batteries for Stationary Energy Storage Systems/ESS
(Source: Fuji Keizai)
The demand for self-consumption and as an energy source to adjust supply and demand is increasing due to rising energy prices, tightening electricity supply and demand, and the introduction of subsidies. In the medium term, the use of energy storage systems will gain momentum in various electricity trading markets, and in the long term, with the spread of electric vehicles (EVs), there will be a movement to reuse the storage batteries installed in EVs as ESS. , and the price of batteries will decrease. It is said that it is becoming more popular. In particular, in the context of rapid growth in the use of renewable energy and power cuts, the field of grid installation/renewable energy to improve the balance of supply and demand in the grid is expected to contribute to market expansion.
Looking at the market size by region in 2024, China and North America alone will account for more than half. On the other hand, Japan is expected to account for only about 4% of the total. China and North America will continue to drive market expansion, but Europe is expected to see significant growth and demand will also increase steadily in Japan.
By major sector, the housing sector is expected to reach 635.1 trillion yen in 2024, up 21.6% from 2023, and is expected to reach 1.2733 trillion yen in 2040, up 2.4 times from 2023. The number of installations is increasing due to rising electricity prices, increased solar self-consumption, official resumption of manufacturers' sales promotion activities, and generous subsidy policies. It is said that the adoption of energy storage systems will increase as regulations become mandatory. The use of electricity storage systems as energy sources and diversification of sales forms are also expected.
The business and industrial sector is expected to grow 20.7% to 126.7 billion yen in 2024 and to 571.3 billion yen in 2040, an increase of 5.4 times. In addition to the increased adoption of BCP (business continuity planning) measures other than self-consumption, the market is expanding because it can be introduced without initial investment by using on-site PPA (power purchase agreement) programs. In the long term, we expect operating models such as DR (demand response)/VPP (virtual power plant) services to be formed.
The renewable energy/grid installation sector is expected to increase 16.3% year-on-year to 2,296.6 billion yen in 2024 and to 8,600.9 billion yen in 2040, an increase of 4.4 times. In Japan, the improvement of the electricity market system has increased the profit opportunities for energy storage systems, and overseas, power companies are increasingly requesting the installation of energy storage systems. In the long term, as the demand for energy regulation increases due to the proliferation of renewable energy, transactions in the electricity market are expected to become more active and the market will expand.
The UPS (uninterruptible power supply) and base station sector is expected to grow 8.2% in 2024 to 806 billion yen, and is expected to grow 39.2% to 1,036.3 billion yen in 2040. Demand for UPS for data centers remains stable due to advances in cloud services, digitalization, and 5G network construction. In the long term, backup power supplies are expected to increase as the number of 5G/6G base stations increases, contributing to market expansion.
The market to watch is grid energy storage systems, which are expected to grow 18.5% to 1,507.5 billion yen in 2024 and 5.4 times to 6,849.4 billion yen in 2040. While lithium-ion batteries are common, demand for NAS batteries and redox flow batteries is expected to increase in the future as a countermeasure to long-term fluctuations and for large systems.
In Japan, which accounts for about 10% of the market, the grid battery storage business is growing thanks to advances in the institutional design of various electricity markets, including the wholesale electricity market, the supply and demand adjustment market, and the capacity market. A long-term decarbonized power auction that will provide fixed income for 20 years will be held in April 2024 and is highly anticipated with numerous applications. From the second half of the 2020s, the market is expected to expand significantly as electricity storage systems introduced by the Ministry of Economy, Trade and Industry and the Tokyo Metropolitan Government in various subsidy projects as well as in long-term decarbonized power auctions come into full operation.
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