The worldwide energy storage installations are forecast to reach 1,095GW / 2,850GWh by 2040 from 9GW / 17GWh deployed in 2018, according to research company BloombergNEF (BNEF).
This 122-fold increase in the stationary energy storage market over the next two decades will require $662 billion of investment. It will be made possible by declines in the cost of lithium-ion batteries. The cost of lithium-ion batteries already declined 85 percent during the 2010-18 period.
BNEF’s Energy Storage Outlook 2019 predicts that lithium-ion battery costs will reduce by half per kilowatt-hour by 2030, as demand takes off in two different markets – stationary storage and electric vehicles.
“Two big changes this year are that we have raised our estimate of the investment that will go into energy storage by 2040 by more than $40 billion, and that we now think the majority of new capacity will be utility-scale, rather than behind-the-meter at homes and businesses,” Yayoi Sekine, energy storage analyst for BNEF, said.
10 countries will represent almost three quarters of the market in gigawatt terms. South Korea is the lead market in 2019. China and the U.S. will overtake South Korea by 2040. The remaining big markets include India, Germany, Latin America, Southeast Asia, France, Australia and the U.K.
Falling wind, solar and battery costs mean wind and solar are set to make up almost 40 percent of world electricity in 2040 as compared with 7 percent today. Passenger electric vehicles could become a third of the global passenger vehicle fleet by 2040, up from less than half a percent today, adding huge scale to the battery manufacturing sector.
Demand for storage will increase to balance the higher proportion of variable, renewable generation in the electricity system. Batteries will increasingly be chosen to manage this dynamic supply and demand mix.
The demand for batteries from the stationary storage and electric transport sectors is forecast to be 4,584GWh by 2040, providing a major opportunity for battery makers and miners of component metals such as lithium, cobalt and nickel.