Energy storage market may grow at a CAGR of 8% till 2027

G BALACHANDAR Chennai, December 18

The stationary energy storagemarket in India is expectedto grow at a CAGR of about 8per cent during 2020-27, ac-cording to a report by IndiaEnergy Storage Alliance(IESA).

The growth projection isbased on a business as usual(BAU) scenario with the sup-portive policy framework,MNRE (Union Ministry ofNew and Renewable Energy)targets and ongoing projecttrends.

The report, the latest edi-tion of IESA’s Stationary En-ergy Storage Market Over-view, has taken 2019 as thebase year for the estimationand the forecast period. In2019, the market size shrunkto 21 GWh from 24GWh,primarily due to lower salesin the larger markets such astelecom and inverter batter-ies in 2018.

For the forecast period, the

top growing renewable mar-kets for energy storage sys-tems (ESS) will be integratedinto the grid, diesel optimisa-tion, solar rooftop, and distri-bution utility scales storage.

Renewable integrationRenewable integration intothe grid is slated to grow atCAGR of 32 per cent by 2027due to the focus on solar-wind hybrid tenders by SolarEnergy Corporation of India(SECI) and other governmentagencies, on account of highrenewable target of 450 GWby 2030.

Diesel optimisation isslated to grow at CAGR of 59per cent in short term till2023, with a slower growth inlong term at 30 per cent till2030 accounting for a morereliable national grid whichmay leave less scope forgrowth of backup market.

For the rooftop solar mar-ket, a dip in GST from 28 percent to 5 per cent has been a

driver for the market, withanalysis additionally show-ing that for solar resource-rich States such as Maha-rashtra, Tamil Nadu,Karnataka, West Bengal, As-sam, cost of rooftop solarwith 50 per cent storage sys-tem could meet grid parityby 2023-end.

The Covid impact althoughwill be visible on the rooftopsolar, inverters, and diesel op-timisation markets, the mar-kets are likely to recover after

2021. Other markets such astelecom markets and UPS willhave a medium impact dueto Covid, owing to an in-creased use of electroniccommunication devices suchas smartphones, laptops, andchange in lifestyle owing toremote work.

The most popular batterytechnologies used for energystorage are fl��ooded lead-acidbatteries, valve regulatedlead acid batteries (VRLA),lithium-ion batteries and

other technologies such asfl��ow batteries, thermal bat-teries etc.

Battery technologiesIESA expect the contributionof lead-acid batteries to re-duce over the projectedperiod with fl��ooded lead-acidbattery share going from 52per cent to 19 per cent andfor valve-regulated lead-acidbatteries reducing from 44per cent to 31 per cent. At thesame time, the penetration oflithium-ion batteries is pro-jected to increase rapidlyfrom 4 per cent in 2019 to 45per cent in 2027 primarilydue to the decreasing pricesof lithium-ion battery sys-tems. The share of other bat-tery technologies, althoughstill small, could also in-crease from less than one percent in 2019 to fi��ve per centin 2027.

The 2027 projections con-sist of base case, worst caseand best-case scenarios. Thebest-case scenario projects aCAGR of 14 per cent, whileworst-case scenario assumesa low growth of 2 per cent inthe market.

Top growing renewable markets will beintegrated into grid, diesel optimisation,solar rooftop, distribution utility storage

For the rooftop solar market, a dip in GST from 28 per cent to 5 percent has been the prime driver GETTY IMAGES/ISTOCKPHOTO

Energy storage market may grow at a CAGR of 8% till 2027: Report