Battery Energy Storage System Market 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
[276 Pages Report] The global battery energy storage market size is estimated to be USD 7.8 billion in 2024 and is projected to reach USD 25.6 billion by 2029, at a CAGR of 26.9% during the forecast period. Battery Energy Storage Systems (BESS) are rechargeable systems that store energy from various sources and release it as needed. Comprising one or more batteries, BESS helps balance the electric grid, provides backup power, and enhances grid stability.
Battery Energy Storage System Market Forecast to 2029
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Market Dynamics:
Driver: Renewable Energy Revolution and the Shift to a Low-Carbon Economy
There is a growing global awareness and commitment to transition to a zero-carbon economy. This shift mitigates climate change, which reduces greenhouse gas emissions. Such changes help to reduce the dependency on fossil fuels and promote the adoption of clean, renewable energy. Batteries in energy storage opened up a wide range of economic and sustainable energy efficiency solutions and environmental benefits. The trend toward a low-carbon, low-fossil fuel-based economy relies on zero-carbon electricity sources with low greenhouse gas emissions to provide. Battery energy storage helps in low carbon transition by enabling the use of renewable resources and achieving cost savings. These storage facilities play an essential role in decarbonizing the energy sector, providing an alternative carbon-free source with operational changes that improve electricity consumption.
Restraint: High cost of installing battery energy storage system
The costs of battery energy storage systems depend on the type and the number of batteries used in them. The varying costs are also dependent on the BESS’s applications, such as residential, commercial, and utilities. Further, integrating different batteries, inverters, battery management systems (BMS), and wiring in battery energy storage systems increases costs. 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). Moreover, the total operating cost of battery energy storage systems combines several factors, including costs of charging batteries, labor associated with their installation, the maintenance of plants wherein they are installed, replacement and repair costs of these systems, and costs for their decommissioning and disposal. Thus, the installation of battery energy storage systems in a plant or any required place needs high capital investments that act as a restraint for the growth of the market.
Opportunity: Rapid adoption of battery energy storage systems in rural electrification projects worldwide
Battery storage helps rural areas with electricity. It can store power and give it when needed. These systems let energy be kept away from larger centers. They can be put in far-off spots in a flexible way. For example, stand-alone off-grid systems take in power from local wind, sun, and plants, not regular fuels. These sources are not there all the time. So, there is need for storage to keep power for short or long times. This ensures that power is made even when there is less power. Also, these systems let homes make their own power so they are not hit by blackouts or rough weather. A lot of rural power plans are on the rise due to outages or urgent use in rural parts around the world.
Challenges: Aging of lithium-ion batteries due to complex chemical reactions between electrodes and electrolytes
Despite remarkable recent developments and improvements, lithium-ion battery technology has critical challenges. Lithium-ion cells age with time and usage, reducing energy and storage capability. Battery cell deterioration is noticeable in mobile phones and laptops. While these challenges are an inconvenience in portable devices, it is a serious issue for electric vehicles and other high-power applications. Cell aging directly reduces the available range in electric vehicles. Lithium-ion cells will always age due to innate chemical reactions between the negative electrode and electrolyte. The rate at which aging occurs is a complex relationship between cell usage and cell design. Currently, there is no solution to ensure an acceptable battery life in all conditions; this can only be achieved through further improvements in cell design, battery pack construction, and usage optimization, in conjunction with gaining a more thorough understanding of the fundamental aging mechanisms of emerging cell chemistries.
Battery Energy Storage System Market Ecosystem
The high power and energy density requirements have led to a rise in demand for reliable and safe batteries for use in different industries. The advent of electric vehicles, renewable energy storage systems, and consumer electronics has been driving increased investments in the field of batteries, from the aspects of both incumbents and new players. With the rise in the adoption of electronic devices, the demand for battery energy storage systems has also grown rapidly. There are several participants in the ecosystem of batteries, and each participant, right from raw material suppliers to end users, has a specific and important role to play.
Lithium-ion batteries to 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. Sony brought them to market in 1991 for consumer electronics. Presently, they are used a lot for high-power applications which need a regular energy supply for a long time. These batteries are versatile and can be used for small applications as well as high power applications. Their use has grown a lot since the cost of storing energy dropped. These batteries are used for a range of things from small home systems to huge grid ones. Small systems in homes are the most common. These batteries can work for electric vehicles and energy storage needs. Further, these batteries also find applications in homes with solar power which are integrated with batteries for continuous energy supply. These batteries are also used in large scale applications such as grid storage applications so that they can power the grid when in high peak demand times.
On-grid connection type segment to account for 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 during times when electricity is available in plenty and is inexpensive or when the demand is low. This electrical energy is returned to the electrical grid when the demands are high and the electricity prices tend to be higher. Thus, 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 electrical grid.
The residential application segment to grow with a significant CAGR during the forecast period.
BESS, such as wind and solar, generate a large quantity of energy. Batteries hep in storing the excess amount of energy generated during peak hour production. This surplus energy can then be used in times of power outages. Thus, the ability to store energy during the peak production period, leading to less wastage, is driving the adoption of battery storage systems. The use of battery energy storage systems in residential applications enables savings on electricity bills, self-consumption, and emergency power backup. ESS used in residential applications is used to provide power to residential buildings, such as condominiums, co-operative societies, and single-family homes. They are also used as emergency power sources in residential buildings.
Asia Pacific segment is likely to dominate the battery energy storage system market during forecast period.
The market in Asia Pacific is further segmented into China, Japan, India, Australia, and the Rest of Asia Pacific. The region is the largest market for battery energy storage and is home to some of the fastest-growing economies in the world. Several countries in Asia Pacific also plan for electrification in remote areas that are mainly off-grid. Residential energy storage technologies will enable increased access to electricity for remote and island communities in the region.
Investments in energy storage are projected to rise significantly in the region, driven by new government policies in emerging economies aimed at enhancing the quality and reliability of power distribution for residential customers. Additionally, various countries' governments prioritize reducing the energy sector's environmental impact. These factors contribute to the increased deployment of battery energy storage systems in residential and public utility applications.
Battery Energy Storage System Market by Region
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Key Market Players
BYD Company Ltd, Samsung SDI Co., Ltd., LG Energy Solutions, and Panasonic Corporation are among the major players in the battery energy storage system companies. Other companies in the market are Tesla, GE Vernova, Hitachi Energy Ltd., Siemens Energy and others.
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Report Metric |
Details |
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Market Size Availability for Years |
2020–2029 |
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Base Year |
2023 |
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Forecast Period |
2024–2029 |
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Forecast Units |
Value (USD Million) |
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Segments Covered |
By Battery, Connection Type, Ownership, Energy Capacity, Application and Region |
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Geographies Covered |
North America, Europe, Asia Pacific, and RoW |
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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
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Segment |
Subsegment |
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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 January 2024, Grenergy has partnered with BYD to supply 1.1 GWh of energy storage systems (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 battery energy storage system (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 supplied 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 Energy Storage System (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 Uninterruptible Power Systems (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?
Major players of battery energy storage system 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 players in the battery energy storage system value chain?
Surging demand for battery energy storage systems in utility applications and growing demand for continuous power supply are some of the major drivers and opportunities for the battery energy storage system market.
Which application of the battery energy storage system market is expected to drive the market's growth in the next five years?
The utilities application is anticipated to experience a more substantial expansion during the projected timeframe. This market segment's growth can be attributed to the growing need grid modernization.
Which region to offer lucrative growth for the battery energy storage system market by 2029?
During the projected period, it is anticipated that the Asia Pacific will take the lead in the battery energy storage system market. Also, the Asia Pacific region is expected to experience the highest growth rate from 2024 to 2029.
Which battery type of the battery energy storage system market is expected to drive the market's growth in the next five years?
Lithium-ion battery type is anticipated to drive the market growth in the coming years.
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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.
Generating Response ...
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?