Analyst Insight: Trends to Watch in Energy Storage 2022

Energy storage is central to creating a smarter, more flexible energy system. Storage technologies can maximize the use of intermittent and distributed renewable generation, by storing and discharging energy when required. Storage technologies are also highly flexible. They provide essential balancing services, improving system stability and mitigating network constraints by relieving congestion on the grid. This immense flexibility is valuable for investors, utilities, grid operators, and end-users; and makes storage technologies a natural complement to other rapidly growing renewable energy assets like solar and wind.

Dramatic cost declines, increasing manufacturing capacity, and market and regulatory reforms have combined in recent years to create a thriving energy storage market. These factors are responsible for the considerable growth in both the distributed and utility-scale settings. As governments around the world strive to retire gas peaker plants in favor of less carbon-intensive methods, and while Europe looks to reduce reliance on natural gas imports amid geopolitical concerns, Guidehouse Insights expects the storage market to grow steadily through 2031.

This Guidehouse Insights report highlights five trends to watch in energy storage in 2022. Topics include growing regulatory and policy support, falling lithium-ion prices, increased competition for battery procurement, a fast-developing long duration storage market, and the proposed investment tax credit for US standalone storage.