In a recent webinar Mara White, product manager for Outback Power discussed the huge opportunity for storage and the growth of the solar market. Here’s a lightly edited recap from the webinar transcript. You can watch the full webinar here.
Storage is a critical part in the PV industry. Let’s examine how the energy storage market fits into solar, and some of the market drivers as we look forward through the next three years.
Solar’s on a roll
U.S. PV is a $14 billion business, with more than 13,000 MW installed. There’s been more solar installed in the past 18 months than in the last 30 years. Ten years ago, a solar system was installed every 1.5 hours. Today there’s a system going in every four minutes. The adoption in recent years has mostly been driven by government incentives and aimed at promoting the adoption of renewable energy.
On a global level, there are 55 GW of installed solar. Historically the market’s been dominated by Europe, or countries that have offered incentive schemes. A lot of the expected growth between now and 2018 is going to be in Asia and the Americas. In the market projects chart, there’s a little dip in America in 2017 due to the expiration of the ITC. This type of global view includes both grid connected and off-grid PV. Storage has historically been seen in the off-grid market, but that is expected to change as storage becomes more commonly used to back up grid-connected projects.
Storage as a market driver post-ITC
The development of storage for PV is essential to increase the ability of PV systems to replace existing energy sources. Annual PV storage installations are expected to grow from 50,000 MW to more than 70,000 MW by 2018, resulting in a $8.2 billion market. Storage is anticipated to be a new market driver to help the PV industry stay consistent, and even pick up speed, post 2017.
Opportunities in solar plus storage
Currently, grid-connect systems with battery back-up only account for about 9% of the revenue from PV plus energy storage. But by 2018, these systems are projected to increase and drive 28% of solar storage revenue.
Energy storage can be deployed in most PV markets today, including residential, commercial and utility segments. Energy storage can reduce grid power usage at certain peak electricity demand times, helping drive down electricity bills for many customers. It can also be used to smooth system output to overcome grid integration challenges. This includes both new solar installations and those to be retrofitted with storage.
The biggest hurdle to solar plus energy storage
The cost of storage technology remains one of the biggest hurdles to incorporating it into solar. However, energy storage is said to be where PV was six or seven years ago, and the factors that lead PV to mass affordability will have a similar effect on storage. Battery costs are declining due to dozens of start-up companies, new technologies and far safer and more efficient types of inverter and storage options.
Solar plus storage as a global transformation technology
Looking at the PV industry on a broader level, a list of disruptive technologies includes energy storage specific to renewable energy: IHS ranks the top 10 global technologies transforming the world as 10. artificial intelligence, 9. biometrics, 8. flexible displays, 7. sensors, 6. advanced user interfaces, 5. graphene, 4. energy storage and advanced battery technologies, 3. 3-D printing, 2. cloud computing and big data, 1. the internet of everything. Energy storage and advanced technologies will be critical to maintain the reliable electricity grid.