Analyst Insight: Residential DER Set for Long-Term Growth

Despite the lasting effect of COVID-19 on the value chain, deployments of distributed energy resources (DER) are expected to continue to increase in 2021. According to Guidehouse Insights estimates, the global market for residential DER is expected to add more than 60 GW in annual capacity in 2021. Beyond 2021, residential DER looks set for long-term growth, with EV charging and residential solar leading the way. Over the next decade, residential annual capacity as a percentage of total annual capacity is expected to increase from 31% to 43% as residential applications gain on commercial and industrial (C&I) applications.

The US, China, India, and Japan are expected to be the largest markets for residential DER from 2021 to 2030. Decarbonization and decentralization targets around the globe are expected to drive growth in DER adoption as a supportive regulatory environment encourages investment in DER.

This Guidehouse Insights report focuses on residential DER. The report covers 14 DER technologies grouped across four distinct parts of the value chain that generate, manage, and consume electricity. Despite their distinct characteristics, these technologies usually operate behind the meter (BTM) at customer facilities. In some cases, the technologies are owned and operated by actors outside traditional utilities, such as the technology owner or third-party service providers and aggregators.