Analyst Insight: Long-Duration Storage Captures Greater Market Share

Mitigating renewables intermittency is a popular topic within the energy sector. One of the most popular ways to do so is by installing battery projects to store renewable energy that can be discharged during peak hours. By far the most popular technology has been lithium ion (Li-ion) batteries. However, as peak times become longer and safety and environmental concerns are raised about Li-ion batteries, alternative solutions are becoming popular to provide longer-duration storage. As most storage technologies have a duration of 4 hours or less, long-duration storage means 4 hours or more. However, the adoption of technologies such as flow batteries, power-to-gas, and Vanadium flow batteries are mired by high costs, low energy efficiency, and in some regions, a lack of policy to encourage investment.

The US and China both lead in terms of long-duration projects deployed. Both respective governments have played an important role in funding and supporting the deployment of such projects. Another region worthy of note is Latin America, which has the expansive geography to deploy large-scale storage projects, such as thermal or pumped hydro. Meanwhile, Europe has the highest capacity proportional to the number of long-duration storage projects in its mix at 17%, compared with 10% in North America and 6% in Asia Pacific.

This Guidehouse Insights report examines long-duration storage trends, including market inflection trends, drivers, and barriers. It also provides a regional overview before giving recommendations for stakeholders in the long-duration storage industry.