According to the latest “US Energy Storage Monitor” report from Wood Mackenzie and the U.S. Energy Storage Association (ESA), 2,156 MWh of new energy storage systems were brought online in Q4 2020. This is an increase of 182% from Q3 2020, making Q4 the new record quarter for U.S. storage.
As prices fall and barriers to storage deployment are eroded, front-of-the-meter (FTM) storage is taking off in the United States. Four out of every 5 MW deployed in Q4 were FTM storage. The segment contributed 529 MW out of the total 651 MW of storage deployed in Q4. California saw the lion’s share of Q4 FTM deployments, according to the report.
At 90.1 MW deployed, residential storage projects made up 14% of the megawatt total for Q4. After gradual growth in deployments over the first three quarters of 2020, Q4 saw a notable residential spike, driven in large part by homeowner interest in California.
Massachusetts led the non-residential segment in Q4, which is growing more slowly than the other two U.S. storage segments and deployed 76.5 MWh during the quarter. California and Hawaii also saw several new projects come online.
In 2020 overall, 1,464 MW/3,487 MWh of new storage came online in the United States. 179% more storage was added in 2020 than in 2019 in megawatt terms. The U.S. storage market will add five-times more megawatts of storage in 2025 than was added in 2020, with FTM storage continuing to contribute between 75-85% of new megawatt-capacity each year.
“2020 is the first year that advanced energy storage deployments surpassed gigawatt scale – a tremendous milestone on the path to our aspiration of 100 GW by 2030,” said Jason Burwen, U.S. Energy Storage Association Interim CEO. “With continuing storage cost declines and growing policy support and regulatory reform in states and the federal government, energy storage is on an accelerating trajectory to enable a resilient, decarbonized, and affordable electric grid for all.”
Q4 was the most eye-catching quarter to date for the residential market. California contributed most residential storage deployments in 2020, and Hawaii was also a very active market, while states in the Northeast, the Midwest, the mid-Atlantic and the Southeast are forecast to see growth over the next few years.
“Battery backup is already becoming somewhat of a contested concept in the industry, as it can have different meanings depending on the installer or vendor,” said Chloe Holden, Wood Mackenzie Research Analyst. “But the ability of solar + storage to provide backup is increasingly driving sales even in markets without additional incentives, particularly states that suffer from regular power outages. We expect an uptick in home battery sales in Texas in the aftermath of February’s devastating outages.”
News item from ESA
Add EV’s to the mix, and we will see unprecedented changes in the marketplace. EV will not only provide and draw energy from homes, but can be deployed to energize neighborhoods. California wants to start by this summer, although the utilities appear to think that’s overly optimistic. I guess EVs can be viewed as peaker plants on wheels…
And lithium batteries aren’t the only solution. Utilities are successfully deploying thermal batteries (on a limited but growing scale). Grid-integrated water heaters (GIWH) represent a $3.6 billion market and can integrate up to 100,000 MW of solar and wind power (according to Rocky Mountain Institute as report by utilitydive.com).
Add to the mix commercial and residential pricing structures that more closely tie to the real-time cost of wholesale energy, and there’s significant new value streams that solar contractors can deliver to homeowners and businesses.
The interest in solar and battery storage will only get stronger as battery costs go down and technology improves. Add on top of this worsening global crises and a push to become more resilient, and interest in battery storage is going to continue to increase.
The technology and the packaging are becoming more effectively coupled into a whole system. Now with smart ESS and grid interactive inverters one can run algorithms that take solar PV, store it in the battery, use the same buss to address the home’s load needs and control power flow to create a self consumption system. With an oversized array, one can use larger energy storage for longer portions of the day to use self consumption later into the night time hours. Get your system A.C. output, D.C. battery storage balanced and you could become grid agnostic. On average just enough overall generation to actually take care of the home’s daily energy needs and if the grid fails, power shedding to allow critical circuits in the home will be powered by solar PV + battery for as long as the grid is down. The rote utility’s, rule, regulation, cost cutting, dividend enhancing problems should not culminate your loss of power on any given day.