All Reports
4Q 2021

Energy Storage Pricing Trends

Advanced Energy Storage System and Battery System Component Costs and Trends for Grid Storage and Transportation: Global Analysis and Forecasts

Energy storage and its effect on the transportation and electricity sectors have grown in recent years as storage costs remain on a downward trajectory and new opportunities for storage emerge across a multitude of industry sectors and applications. The availability of lower cost, higher performance lithium ion (Li-ion) batteries for EVs is catalyzing electrification of the transportation sector. However, grid-scale energy storage lacks the restrictive power and weight specifications of EVs, allowing different storage technologies to compete to provide current and future grid flexibility services. As the evolution of the stationary storage industry continues, assessing the various storage technologies, comparing their costs and performance, and understanding the drivers behind future price declines is becoming more important.

The primary driver behind price declines for Li-ion batteries—the main technology of choice for EVs and stationary storage—is the rapidly growing capacity of global battery manufacturing. Since the onset of the COVID-19 pandemic, Li-ion battery production plans have accelerated. As of 2021, there are plans to build nearly 200 gigafactories around the world over the next decade. In terms of battery capacity, this amounts to over 3 TWh—the single largest increase in pipeline battery capacity since Guidehouse Insights started collecting this data.

This Guidehouse Insights report provides system and component price forecasts for four markets: residential energy storage, commercial and industrial (C&I) energy storage, utility-scale energy storage, and EV batteries (EVBs). This report focuses primarily on the specifics of pricing Li-ion systems for these four markets. Forecasts are provided for major global regions and cover 2021-2030.

Pages 47
Tables | Charts | Figures 37
  • What are average market prices for new grid storage projects by technology?
  • What are projected future average market prices for new grid storage projects by technology?
  • How does the discharge duration of a Lithium ion (Li-ion) energy storage project affect price?
  • What is the breakdown of Li-ion energy storage project price by the components of a project?
  • What are the current and future prices of Li-ion battery cells?
  • What are the current and future prices of Li-ion battery packs for EVs?
  • What is the breakdown of EV battery price by the components of a battery pack?
  • Advanced battery OEMs
  • Inverter and other balance of system vendors
  • Government and regulatory agencies
  • NGOs
  • Energy storage integrators
  • Solar PV OEMs
  • Wind Turbine OEMs
  • Energy storage hardware vendors and technology firms
  • Engineering, procurement, and construction (EPC) firms
  • Renewable energy development financing companies
  • Inverter and other balance-of-system vendors
  • Utilities
  • Investor community

1. Executive Summary

1.1    Market Update

1.2    Market Forecasts

2. Market Overview

2.1    Introduction to Energy Storage Technologies

2.1.1   Advanced Lead-Acid Batteries

2.1.2   Compressed Air Energy Storage

2.1.3   Flow Batteries

2.1.4   Flywheels

2.1.5   Li-Ion Batteries

2.1.6   Sodium-Based Batteries

2.1.7   Power-to-Gas

2.1.8   Pumped Hydro Storage

2.1.9   Ultracapacitors

2.2    Energy Storage Market Segments

2.2.1  Grid Storage

2.2.1.1        Cost Components of Grid Storage Projects

2.2.1.2        Cost Components of Distributed Energy Storage Projects

2.2.2  EVBs

2.2.2.1        Cost Components of EVBs

2.3    Market Drivers

2.3.1  Technological Advancements

2.3.2  Public and Private R&D

2.4    Market Barriers

2.4.1  Supply Chain Risks and Sustainability Concerns

2.4.1.1        Lithium Supply and Geopolitical Concerns

2.4.1.2        Chinese Control of Global Lithium Supplies

2.4.1.3        Cobalt Supply and Geopolitical Concerns

2.4.2  Projected Price Volatility

2.4.3  Environmental Impacts

2.4.4  Decommissioning and Disposal

2.5    Energy Storage Market Trends

2.5.1  Manufacturing Growth

2.5.2  Li-Ion Supply Chain

2.5.2.1        Li-Ion Supply Chain

2.5.2.2        Chemical Refining

2.5.2.3        Cathode and Anode Production

2.5.2.4        Li-Ion Cell Manufacturing

2.5.2.5        Auto Manufacturing

2.5.2.6        Second-Life Batteries and Recycling

2.5.3  Grid Storage Market Trends

2.5.3.1        Utility-Scale Energy Storage

2.5.3.2        Residential Energy Storage

2.5.3.3        C&I Energy Storage

2.5.4  EV Market Trends

3. Market Forecasts

3.1    Methodology and Forecast Assumptions

3.2    Li-Ion Cell Prices

3.3    Grid Storage Project Technology Comparisons

3.4    Grid Storage Project Pricing by Component

3.4.1   Residential

3.4.2   C&I

3.4.3   Utility-Scale

3.5    EVB Packs

4. Conclusions and Recommendations

4.1    The Commoditization of Li-Ion Battery Cells

4.2    Automakers and Stationary Battery Integrators’ Long Term Cell Supply Agreements

4.3    First Mover Advantage

5. Acronym and Abbreviation List

6. Table of Contents

7. Table of Charts and Figures

8. Scope of Study, Sources and Methodology, Notes

  • Utility-Scale Li-Ion Battery System Pricing by System Duration, Total Installed Costs, Base Case, World Markets: 2021-2030
  • Large Format Li-Ion Battery Cell Pricing by Technology Case, Average Installed Costs, World Markets: 2021-2030
  • Utility-Scale ESS CAPEX Assumptions by Technology, Average Installed Costs, World Markets: 2021-2030
  • Utility-Scale Energy Storage CAPEX Assumptions by Technology, Average Installed Costs, World Markets: 2021-2030
  • Residential Li-Ion Battery System Pricing by Cost Component, 5 kW/12 kWh System, Base Case, US: 2021-2030
  • C&I Building Li-Ion Battery System Pricing by Cost Component, 250 kW/500 kWh System, Base Case, US: 2021-2030
  • Utility-Scale Li-Ion Battery System Pricing by Component, 20 MW/10 MWh System, Base Case, Average Installed Costs, World Markets: 2021-2030
  • Utility-Scale Li-Ion Battery System Pricing by Component, 20 MW/20 MWh System, Base Case, Average Installed Costs, World Markets: 2021-2030
  • Utility-Scale Li-Ion Battery System Pricing by Component, 20 MW/80 MWh System, Base Case, Average Installed Costs, World Markets: 2021-2030
  • Light Duty BEV Li-Ion Battery System Pricing by Component, 60 kWh, Average Installed Costs, World Markets, Base Case: 2021
  • Li-Ion Battery Cell Capacity in 2020 and Planned Battery Cell Capacity for 2030
  • Notable Large-Scale Li-Ion Battery Manufacturing Facilities: 2021
  • Advanced Battery Comparison
  • Annual Battery Energy Storage Energy Capacity Additions by Market Segment, World Markets: 2021-2030
  • Annual Battery Energy Storage Project Deployment Revenue by Market Segment, World Markets: 2021-2030
  • Total New Annual EV Battery Energy Capacity by Region, World Markets: 2021-2030
  • Total New Annual EV Battery Revenue by Region, World Markets: 2021-2030
  • Utility-Scale ESS CAPEX Assumptions by Technology, Average Installed Costs, World Markets: 2021-2030
  • Large Format Li-Ion Battery Cell Pricing by Technology Case, Average Installed Costs, World Markets: 2021-2030
  • Residential Li-Ion Battery System Pricing by Cost Component, 5 kW/12 kWh System, Base Case, US: 2021-2030
  • Residential Li-Ion Battery System Pricing by Cost Component, 5 kW/12 kWh System, High Case, US: 2021-2030
  • Residential Li-Ion Battery System Pricing by Cost Component, 5 kW/12 kWh System, Low Case, US: 2021-2030
  • C&I Building Li-Ion Battery System Pricing by Cost Component, 250 kW/500 kWh System, Base Case, US: 2021-2030
  • C&I Building Li-Ion Battery System Pricing by Cost Component, 250 kW/500 kWh System, High Case, US: 2021-2030
  • C&I Building Li-Ion Battery System Pricing by Cost Component, 250 kW/500 kWh System, Low Case, US: 2021-2030
  • Utility-Scale Li-Ion Battery System Pricing by Cost Component, 20 MW/10 MWh System, Base Case, Average Installed Costs, World Markets: 2021-2030
  • Utility-Scale Li-Ion Battery System Pricing by Cost Component, 20 MW/10 MWh System, Low Case, Average Installed Costs, World Markets: 2021-2030
  • Utility-Scale Li-Ion Battery System Pricing by Cost Component, 20 MW/10 MWh System, High Case, Average Installed Costs, World Markets: 2021-2030
  • Utility-Scale Li-Ion Battery System Pricing by Cost Component, 20 MW/20 MWh System, Base Case, Average Installed Costs, World Markets: 2021-2030
  • Utility-Scale Li-Ion Battery System Pricing by Cost Component, 20 MW/20 MWh System, Low Case, Average Installed Costs, World Markets: 2021-2030
  • Utility-Scale Li-Ion Battery System Pricing by Cost Component, 20 MW/20 MWh System, High Case, Average Installed Costs, World Markets: 2021-2030
  • Utility-Scale Li-Ion Battery System Pricing by Cost Component, 20 MW/80 MWh System, Base Case, Average Installed Costs, World Markets: 2021-2030
  • Utility-Scale Li-Ion Battery System Pricing by Cost Component, 20 MW/80 MWh System, Low Case, Average Installed Costs, World Markets: 2021-2030
  • Utility-Scale Li-Ion Battery System Pricing by Cost Component, 20 MW/80 MWh System, High Case, Average Installed Costs, World Markets: 2021-2030
  • Light Duty BEV Li-Ion Battery System Pricing by Cost Component, 60 kWh, Base Case, Average Installed Costs, World Markets: 2021-2030
  • Light Duty BEV Li-Ion Battery System Pricing by Cost Component, 60 kWh, Low Case, Average Installed Costs, World Markets: 2021-2030
  • Light Duty BEV Li-Ion Battery System Pricing by Cost Component, 60 kWh, High Case, Average Installed Costs, World Markets: 2021-2030
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