Energy Storage for Solar Systems Will be an $8 Billion Market in 2026
The success of solar-plus-storage defines the growth potential of renewable energy,
creating needs for new partnerships and technologies, says Lux Research
BOSTON, MA – January 28, 2016 – Distributed storage for solar systems will be worth $8 billion in 2026 as solar combines with storage in order to continue its remarkable growth, according to Lux Research. Solar-plus-storage is a key necessity for solar to overcome limitations like intermittency and the lack of power after dark.
Energy storage will increase the distributed solar market by 25 GW annually in 2026. Adding storage adds costs, affecting revenue streams and addressable market size, but as installed solar system costs decline – from $3.83/W in 2015 to $1.87/W in 2035 – an attractive economic case will emerge in 2023, leading to strong growth.
“As the solar-plus-storage market matures, interesting developments will unfold on a number of fronts. There will be more vertical integration between the two industries, increased financing options and even a move towards energy-sharing between communities,” said Cosmin Laslau, Lux Research Senior Analyst and lead author of the report titled, “Helping Renewables Shine On: Analyzing the New Business Cases Where Batteries Make Sense for Solar Systems.”
Lux Research analysts studied the impact on distributed solar of its integration with storage to maintain growth. Among their findings:
- Solar-storage partnerships begin to emerge. Partnerships between Stem and SunPower, Green Charge Networks and SunEdison, and Sonnen and Sungevity reveal the industry’s future. First Solar even joined a $50 million investment in Younicos, a leader in grid-scale energy storage integration.
- Software is a key differentiator. Leaders like SolarCity and others are offering demand management software that can help integrate storage. Sunverge’s system can link to smart devices and electric vehicles, while Sonnenbatterie’s software can analyze weather data to optimize solar consumption and storage.
- Policy support has big impact. Thanks to policy support, Germany has installed 12,000 solar-plus-batteries systems since 2013 with a recent growth rate of 35%. Japan has launched a subsidy program to cover two-thirds of the installation costs for lithium-ion battery systems at 1kWh or larger, while California offers a $1.46/W incentive – and mandates utilities to install 1.3 GW of storage by 2020.
The report, titled “Helping Renewables Shine On: Analyzing the New Business Cases Where Batteries Make Sense for Solar Systems,” is part of the Lux Research Solar Intelligence, Energy Storage Intelligence, and Distributed Generation Intelligence services.
To hear more about energy storage trends, register for the complimentary webinar, “The Coming Battery Revolution: How Improving Batteries Will Enable Entirely New Products and Applications” on April 5th at 11:00 EDT.