Battery Energy Storage System Market Size, Share & Industry Trends Growth Analysis Report by Battery Type (Lithium-ion, Advanced Lead Acid, Flow, Nickel-based), Energy Capacity (Below 100 MWh, Between 100 MWh & 500 MWh, Above 500 MWh), Connection Type, Ownership and Region - Global Forecast to 2029
Updated on : Sep 13, 2024
Battery Energy Storage System Market Size & Share
[276 Pages Report] The global battery energy storage system (BESS) market size is estimated to be USD 7.8 billion in 2024. It is projected to reach USD 25.6 billion by 2029, at a CAGR of 26.9% during the forecast period.
A BESS system comprises several rechargeable batteries explicitly arranged to store energy from various sources, such as solar and wind renewable sources, and release it to the grid when the demand rises. The trend of shifting to renewable energy sources from fossil fuels drives the market's growth.
Furthermore, the increasing installations of BESS in grid modernization projects globally and rising investments in enhancing grid functionality further drive the BESS market. Virtual power plants, battery material optimization, dynamic grid management, demand response, and capacity management programs are other key trends impacting the BESS market growth.
Artificial intelligence (AI) is also being used to enhance BESS systems as AI technology could help optimize battery performance, improve efficiency, and thus enhance grid stability. The AI technology enables various advanced functionalities such as predictive maintenance and optimized charging & discharging cycles, which lead to sustainable BESS system design.
Battery Energy Storage System Market Forecast to 2029
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Battery Energy Storage System Market Trends
Driver: Increasing global investments for grid infrastructure enhancement
The escalating demand for reliable, cost-effective, and environmentally friendly energy storage solutions drives investments in grid infrastructure, thus boosting the BESS market growth. Increasing investments in grid infrastructure is a critical strategy to enhance energy systems' reliability, efficiency, and sustainability.
Such investments address multiple aspects of the power grid, including modernization, resilience, and integration of renewable energy sources. Hence, they are essential for meeting contemporary energy demands and future requirements.
Restraint: High installation and maintenance costs associated with BESS
The costs of battery energy storage systems depend on the type and the number of batteries used. During the installation of battery energy storage systems, the required capital cost is dependent on the footprint and power requirements of storage systems; components (batteries, power conversion systems, and BMS) used in them; and facility infrastructure (communications and control, environmental control, and grid interconnection) wherein they are deployed.
The capital cost also depends on the system control cost, the electric balance of point cost (BOP), and construction and commissioning costs (C&C). The varying costs also depend on the BESS’s applications, such as residential, commercial, and utilities. Thus, installing battery energy storage systems in a plant or any required place requires high capital investments that restrain the market's growth.
Opportunity: Increasing opportunities in rural electrification
Rural electrification refers to making electrical power accessible to rural or remote areas. Various countries are developing their remote regions, such as isolated rural and semi-urban areas, especially in emerging countries and small islands that are not directly connected with national grids.
The installation of battery energy storage systems in rural areas would act as a solution to serve businesses and local communities with reliable and safe power supplies. The reliable and uninterrupted power supply from BESS projects can increase overall system efficiency and ensure savings during the systems' life cycles.
Challenges: Installation of battery energy storage systems in remote locations
Remote locations usually include islands and off-grid locations, which face various challenges owing to variable generation and power supply from renewable energy sources. T
he challenges are related to ambient conditions such as temperature variations during the day and night, high maintenance costs owing to commuting difficulties in reaching these locations, and the lack of equipment installation infrastructure.
Battery Energy Storage System Market Ecosystem
The advent of electric vehicles, renewable energy storage systems, and consumer electronics has driven increased investments in batteries and BESS from established and new players. The BESS market ecosystem has several participants, and each participant, from raw material suppliers to end users, has played a crucial role in developing and deploying battery energy storage systems worldwide.
Battery Energy Storage System Market Segment
Lithium-ion (Li-ion) batteries account for the largest share of the battery energy storage system market
Li-ion batteries are widely used in storing energy due to their power and long life. These batteries are versatile and can be used for small and high-power applications. Their use has grown a lot since the cost of batteries and the cost of storing energy dropped.
These batteries can work for electric vehicles and energy storage needs in residential, commercial, and industrial sectors. These batteries are also widely used in large-scale applications such as grid storage applications to power the grid during high peak demand times.
On-grid connection segment will account for a significant market share during the forecast period
The on-grid battery energy storage systems help in energy storage on a large scale. Electrical energy is stored when electricity is available in plenty or when the demand is low. On-grid battery energy storage systems use utility grids to supply electricity to consumers, which also helps to reduce energy bills. Load leveling, peak shaving, and power demand management are the main applications of any on-grid connected battery energy storage systems installed with an electrical grid.
Residential application segment is to grow with a significant CAGR during the forecast period
BESS, such as wind and solar, generates a lot of energy, and batteries help store the excess energy generated during peak-hour production. This surplus energy can then be used in times of power outages. The energy storage during the peak production period leads to less wastage and thus drives the adoption of battery storage systems.
BESS is used in residential applications to power buildings such as condominiums, cooperative societies, and single-family homes. Using battery energy storage systems in residential applications enables savings on electricity bills, self-consumption, and emergency power backup.
Battery Energy Storage System Market by Region
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Battery Energy Storage System Market Regional Analysis
Asia Pacific segment to dominate the battery energy storage system market during forecast period
The Asia Pacific market is segmented into China, Japan, India, Australia, and the Rest of the region. The region is the largest market for battery energy storage and is home to some of the fastest-growing economies in the world. Investments in energy storage are projected to rise significantly in the region, driven by favorable government policies that aim to enhance the quality and reliability of power distribution for residential, commercial, and industrial customers. Several countries in Asia Pacific are planning for electrification in remote areas that are mainly off-grid. These factors contribute to the BESS market growth in Asia Pacific countries.
Top Battery Energy Storage System Companies - Key Market Players
- BYD Company Ltd,
- Samsung SDI Co., Ltd.,
- LG Energy Solution, and
- Panasonic Corporation are among the major players in the BESS market. Other companies in the market are Tesla, GE Vernova, Hitachi Energy Ltd., Siemens Energy and others.
Battery Energy Storage System Market Report Scope
Report Metric |
Details |
Estimated Market Size | USD 7.8 billion in 2024 |
Projected Market Size | USD 25.6 billion by 2029 |
Growth Rate | CAGR of 26.9% |
Market Size Availability for Years |
2020–2029 |
Base Year |
2023 |
Forecast Period |
2024–2029 |
Forecast Units |
Value (USD Million) |
Segments Covered |
By Battery, Connection Type, Ownership, Energy Capacity, Application and Region |
Geographies Covered |
North America, Europe, Asia Pacific, and RoW |
Companies Covered |
The major players include BYD Company Ltd. (China), LG Energy Solution (South Korea), Panasonic Corporation (Japan), Samsung SDI Co., Ltd. (South Korea). A total of 25 players are covered. |
Battery Energy Storage System Market Highlights
This research report categorizes the battery energy storage system market by battery, connection type, ownership, energy capacity, application, and region available at the regional and global level
Segment |
Subsegment |
Based on Battery |
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Based on Connection Type |
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Based on Ownership |
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Based on Energy Capacity |
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Based on Application |
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Based on Region |
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Recent Developments in Battery Energy Storage System Industry
- In January 2024, Grenergy partnered with BYD to supply 1.1 GWh of ESS. The deal includes 2,136 units of BYD's high-performance MC Cube ESS model, featuring Blade batteries known for their safety and longevity.
- In January 2023, Sweden's prominent cultural center, Sara Kulturhus, is powered by a cutting-edge BESS created by ABB in collaboration with Skellefteå Kraft. The venue's unique design called for innovative solutions, and the BESS was designed to supply the entire building with dependable and environment-friendly electricity. Comprising a transformer, six battery packs provided by local supplier Northvolt, AC, and DC switchgear by ABB, and inverters by EPC Power, the BESS was crafted with careful consideration and extensive expertise.
- In May 2022, Toshiba Corporation introduced the 125VDC SCiB ESS, which combines the dependability of Lithium Titanium Oxide (LTO) battery chemistry with a flexible and expandable cabinet design. The Toshiba 125VDC SCiB ESS is available in various user capacities, including 5kWh, 10kWh, 15kWh, and 20kWh, making it suitable for integration with UPS or DC Load applications.
Key Questions Addressed by the Report:
Who are the key players in the battery energy storage system market? What are the major growth strategies they have taken to strengthen their position in the market?
Significant players in the BESS market include BYD Company Ltd., Samsung SDI Co. Ltd., LG Energy Solution, Panasonic Corporation, and Tesla. Strategies such as acquisitions, product launches, collaborations, agreements and contracts were adopted by these companies to withstand the competitive landscape of this market.
What are the new opportunities for emerging battery energy storage system value chain players?
Surging demand for battery energy storage systems in utility applications and growing demand for continuous power supply across the residential sector are major drivers and opportunities for the battery energy storage system market.
Which application will fuel the BESS market's growth in the next five years?
The utility application is anticipated to experience a substantial expansion during the projected timeframe. This market segment's growth can be attributed to the growing need for grid modernization.
Which region will offer lucrative growth for the battery energy storage system market by 2029?
The Asia Pacific is anticipated to take the lead in the battery energy storage system market and experience the highest growth rate from 2024 to 2029.
Which battery type will drive the market's growth in the next five years?
The lithium-ion battery type is anticipated to drive market growth in the coming years, owing to its high energy density and successful use cases across many commercial and industrial applications.
To speak to our analyst for a discussion on the above findings, click Speak to Analyst
The study involved four major activities for estimating the battery energy storage system market size. Exhaustive secondary research has been conducted to collect information relevant to the market, its peer markets, and its child market. Primary research has been undertaken to validate key findings, assumptions, and sizing with industry experts across the value chain of the battery energy storage system market. Both top-down and bottom-up approaches have been employed to estimate the complete market size. It has been followed by the market breakdown and data triangulation methods to estimate the size of different segments and subsegments of the market.
Secondary Research
The research methodology used to estimate and forecast the size of the battery energy storage system market began with the acquisition of data related to the revenues of key vendors in the market through secondary research. Various secondary sources have been referred to in the secondary research process for identifying and collecting information for this study. Secondary sources include annual reports, press releases, and investor presentations of companies; white papers, journals, certified publications, and articles by recognized authors; websites; directories; and databases. Secondary research has mainly been used to obtain key information about the supply chain of the battery energy storage system market, the value chain of the market, key players, market classification, and segmentation according to the industry trends to the bottom-most level, geographic markets, and key developments from both market and technology-oriented perspectives. Secondary data has been collected and analyzed to determine the overall market size, further validated through primary research. The secondary research referred to for this research study involves the Energy Storage Association, International Battery and Energy Storage Alliance, NAATBatt, Clean Energy Council. Moreover, the study involved extensive use of secondary sources, directories, and databases, such as Hoovers, Bloomberg Businessweek, Factiva, and OneSource, to identify and collect valuable information for a technical, market-oriented, and commercial study of the battery energy storage system market. Vendor offerings have been taken into consideration to determine market segmentation.
Primary Research
In the primary research, various primary sources from both the supply and demand sides have been interviewed to obtain the qualitative and quantitative information relevant to this report. Primary sources from the supply side include the key industry participants, subject-matter experts (SMEs), and C-level executives and consultants from various key companies and organizations in the battery energy storage system ecosystem. After the complete market engineering (including calculations for the market statistics, the market breakdown, the market size estimations, the market forecasting, and the data triangulation), extensive primary research has been conducted to verify and validate the critical market numbers obtained. Extensive qualitative and quantitative analyses have been performed during the market engineering process to list key information/insights throughout the report. Extensive primary research has been conducted after understanding the battery energy storage system market scenario through secondary research. Several primary interviews have been conducted with market experts from the demand and supply-side players across key regions, namely, the Americas, Europe, Asia Pacific, and the Rest of the World (Middle East, Africa, and South America). Various primary sources from both the supply and demand sides of the market have been interviewed to obtain qualitative and quantitative information. Following is the breakdown of the primary respondents.
Primary data has been collected through questionnaires, emails, and telephonic interviews. In the canvassing of primaries, various departments within organizations, such as sales, operations, and administration, were covered to provide a holistic viewpoint in our report. After interacting with industry experts, brief sessions were conducted with highly experienced independent consultants to reinforce the findings from our primaries. This and the in-house subject matter experts’ opinions have led us to the findings described in the remainder of this report.
To know about the assumptions considered for the study, download the pdf brochure
Market Size Estimation
The total size of the battery energy storage system market has been estimated and validated using both top-down and bottom-up approaches. Furthermore, these methods have also been used extensively to estimate the size of various subsegments in the market. The research methodology used to estimate the market size is as follows:
- Identifying different entities influencing the value chain of the battery energy storage system market
- Identifying major companies, system integrators, and service providers operating in the market
- Estimating the size of the battery energy storage system market for each region based on demand for battery energy storage system.
- Tracking the ongoing and upcoming energy storage system projects to forecast the market size based on these developments and other critical parameters
- All percentage shares, splits, and breakdowns have been determined using secondary sources and verified through primary sources.
- Qualitative aspects such as market drivers, restraints, opportunities, and challenges have been taken into consideration while calculating and forecasting the market size.
Global Battery Energy Storage System Market Size: Bottom-Up Approach
Global Battery Energy Storage System Market Size: Top-down Approach
Data Triangulation
After arriving at the overall size of the battery energy storage system market from the market size estimation process explained above, the total market has been split into several segments and subsegments. Data triangulation and market breakdown procedures have been employed, wherever applicable, to complete the overall market engineering process and arrive at the exact statistics for all segments and subsegments of the market. The data has been triangulated by studying various factors and trends from both the demand and supply sides. Along with this, the market size has been validated using both top-down and bottom-up approaches.
Market Definition
A battery energy storage system is embedded with a rechargeable battery in the form of battery packs and modules. The system stores energy from solar arrays, wind, or the electric grid and then discharges that energy later to provide electricity or other grid services when needed. Rechargeable batteries are usually expensive and have less environmental impact than non-rechargeable (disposable) batteries. However, rechargeable batteries incur a high upfront cost but they can be charged several times after the initial purchase. Battery energy storage systems are used in low-peak periods to store surplus energy and provide this energy to the end users during the time of high peak demand for electricity.
Key Stakeholders
- Battery energy storage system manufacturers
- Technology providers
- Material providers
- Government bodies and industry associations
- Research Institutes and Organizations
- Battery Cell and Battery Pack Manufacturers
- Equipment suppliers
- System integrators
- Grid operators
- Retail service providers
- Lithium-ion batteries, electrochemical capacitors, and other energy storage products manufacturers
- Electronic device and electric vehicle manufacturers
Report Objectives
- To define, describe, segment, and forecast the size of the battery energy storage system market by battery type, connection type, ownership, energy capacity, and application in terms of value
- To describe and forecast the market for four main regions, namely, the North America, Asia Pacific, Europe, and RoW, in terms of value
- To provide detailed information regarding the drivers, restraints, opportunities, and challenges influencing the growth of the market
- To provide a detailed overview of the value chain of the battery energy storage system ecosystem
- To strategically analyze micro-markets with respect to individual growth trends, prospects, and their contributions to the overall market
- To strategically analyze the ecosystem, Porter’s five forces, regulations, region-wise regulations, upcoming technologies in the market, revenue shift model in the market, patent landscape, trade landscape, and case studies pertaining to the market under study
- To analyze opportunities in the market for the stakeholders by identifying high-growth segments in the market
- To strategically profile key players and provide details of the current competitive landscape
- To analyze strategic approaches adopted by players in the battery energy storage system market, such as product launches and developments, acquisitions, collaborations, agreements, contracts, expansions, and partnerships
Available Customizations:
With the given market data, MarketsandMarkets offers customizations according to the company’s specific needs. The following customization options are available for the report:
Company Information:
- Detailed analysis and profiling of additional market players based on various blocks of the value chain.
Growth opportunities and latent adjacency in Battery Energy Storage System Market
The increasing use of grid flexibility and grid connected solutions due to fluctuations of renewable energy sources such as solar & wind is expected to boost the battery energy system. Can you provide detailed information on this?
Increasing adoption of electric vehicles and fast-growing battery energy storage manufacturing capacity are driving innovations and growth of the market. I would like to get some more insights on the influence of electric vehicles on the BESS market.
The market for lithium-ion technology is expected to grow rapidly; this is likely to be used for storage solutions in various residential and non-residential applications. The declining prices of lithium-ion batteries are also propelling the adoption of this technology, thus supporting the growth of battery energy storage systems. Could you mention any other battery technology which would affect the battery energy storage system market in the near future?
APAC is on the track to become the world leader in energy storage, since China is leading in usage of renewable energy such as solar which requires battery energy storage systems , what could be an opportunity in the next 5-10 years for same.
Energy Storage-as-a-Service (ESaaS) is becoming a key service model, which is a combination of an advanced energy storage system, an energy management system, and a service contract delivering reliable power economically to a business. Can you provide the global numbers for the service segment?