Provide Chain, Interconnection Points Hinder Energy Storage Market

John Hensley

The lately launched U.S. Energy Storage Monitor report, by the American Clean Power Association (ACP) and Wood Mackenzie, states that throughout all segments of the trade, within the first quarter of 2023, the U.S. energy storage market added 2,145 MWh, marking a 26% lower from the fourth quarter of 2022.

The grid-scale phase put in 1,553 MWh within the first quarter of 2023, recording the second-straight quarterly decline and falling 33% beneath first quarter of 2022 installations, the report additionally notes.

California and Texas proceed to drive the energy storage market, accounting for 84% of exercise within the first quarter, however mission delays contributed to the diminishing atmosphere.

“The recent energy storage market slowdown illustrates how storage development is already interwoven with new solar and wind projects – and how trade and policy issues in those sectors affect storage deployment,” says John Hensley, ACP’s vp of analysis and analytics. “It’s crucial we continue to tackle supply chain and interconnection hurdles.”

Wood Mackenzie has slated forecasted 2023 additions from the grid-scale mission pipeline at 8.9 GW and 10.5 GW throughout all segments. While the forecasted capability for 2023 decreased barely quarter-over-quarter (QoQ), whole additions for all segments are nonetheless anticipated to double by end-of-year 2023 from 2022.

“This is the first consecutive quarterly decline we have seen in the energy storage market since 2015 when installations were much smaller in volume and more unpredictable,” observes Vanessa Witte, senior analyst with Wood Mackenzie’s energy storage group.

Community, industrial and industrial (CCI) installations bounced again within the first quarter of 2023, after 4 consecutive quarters of lower-than-average exercise. In whole, the CCI market put in 203.3 MWh for its second-highest quarter on file and 145% above year-over-year (YoY) numbers.

Residential storage recorded its second-highest quarter on file at 388.2 MWh however there was a decline from the fourth quarter of 2022 put in capability. This marked the primary QoQ decline for the residential sector in almost two years.

Market declines are a trigger for concern however appear to be merely non permanent, notes ACP’s Hensley: “The forecast through 2027 is encouraging and we remain confident in the long-term growth trajectory of the sector. The need of energy storage will continue to grow as more clean energy technologies are added to the grid.”

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