Storage in 2024 beat expectations
In another record year for battery storage, the fastest-growing battery demand market, record deployments were seen across key markets.
Storage installations in 2024 beat expectations with 205GWh installed globally, a staggering y-o-y increase of 53%. The grid market has once again been the driver of growth, with more than 160GWh deployed globally, of which 98% was lithium-ion.
Grid-scale market
Globally, the grid storage market increased 68% y-o-y from 96GWh to 160GWh. China accounted for 67% of BESS deployments globally, as provincial level requirements and record low cell and system prices drive forward the market.
The US & Canada was once again the second largest region with close to 40GWh installed, of which half was installed in California alone.
Across the historically smaller BESS markets, strong growth was seen, with new deployments more than doubling in the EU & European Free Trade Association & UK, Latin America and Asia Pacific (ex. China).
Globally 17 projects over 1GWh capacity entered operation, 11 in China, five in the US and one in Saudi Arabia. In 2023, just 4 projects over 1GWh entered operation globally. The pipeline for these large projects is growing significantly across the globe, with 140 projects over 1GWh planned for 2025/26, of which 30 projects are over 2GWh.
Average project duration is increasing globally, with the largest increase seen in Europe now at over two hours for the first time, compared to 1.4 in 2023. In the US & Canada, the average duration of new installations in 2024 was over 3 hours. Systems are being designed to match profitability, as reflected across the two largest US markets, Texas projects had an average duration of 1.7 hours compared to close to 4 hours in California.
Latin America is emerging as a market for longer duration BESS, with average duration of new projects in 2024 just under 4.2 hours.
In 2023 nearly half of BESS (by capacity) that entered operation, was paired with either solar or wind, while in 2024 the share of renewable paired storage has fallen to 40%. This change comes as leasing becomes an increasingly popular option in China and regulation changes to reflect this.
Non-grid-scale markets
Outside of the grid market, over 40GWh of storage was installed. Historically, this has been led by strong residential markets with subsidy support in key European markets. However, a combination of stabilising electricity prices and drops in subsidies have led to a levelling off in this market. China’s BTM (behind-the-meter) market continues to drive global installations, accounting for 39% of the global C&I (commercial & industrial) market and 41% of the UPS (uninterrupted power supply) market.
LFP dominance, but non-lithium technologies gain traction
Across both the grid and behind-the-meter market LFP’s (lithium iron phosphate) dominance over the space has grown, aided by record low cell and system prices, technology innovation and a growing list of market participants.
Competition between cell and system players has been fierce in 2024, with CATL retaining the top spot for cell supply, and EVE energy moving into second place above BYD.
Outside of lithium-ion batteries, flow batteries are progressing well, with deployments increasing over 300% compared to 2023 to over 2.3GWh, with most projects designed with longer duration in mind.
Sodium-ion battery progress has been much slower, with less than 200MWh installed across Chinese projects. Low LFP prices remain a barrier to sodium ion uptake, however several product launches planned for 2025 will likely result in a stronger year.
Looking to 2025, Rho Motion anticipates another strong year for BESS, with over 400GWh of projects in the grid project pipeline and strong growth forecasted in the C&I market.
However, as many project cancellations and delays have been seen in recent years, we would estimate that at least 30% of the grid pipeline will not reach completion in 2025.
Looking longer term the project pipeline from 2025 to 2030 now sits at well over 1TWh, an impressive feat in a market that was 1% of that size in 2021.
The past year saw new regions developing capacity markets and either announcing or holding centrally procured project tenders, further increasing the reach of energy storage and boosting global upside predictions. Some key markets to keep an eye on in 2025 are Australia, Saudi Arabia, Central and Eastern Europe, Canada and Chile.
About the Author
Iola Hughes leads and coordinates research at Rho Motion, working on electric vehicle, battery and energy storage market analysis. Her work spans the battery demand sectors, from electric vehicle to stationary storage forecasting, managing the team’s view of battery demand and chemistry, and considering the influence of key variables from legislation to OEM strategy and technology roadmaps. London-headquartered Rho Motion offers forecasts and analysis for the energy transition.