The ever growing need for energy security and reliable power supply has figured The Global Energy Storage Market for Microgrids as an equitable solution. Energy storage systems are providing unique and ancillary, customer energy management services, to an evolving grid.
Globally, deployments of microgrid projects have increased in the recent past. This is because of the need for energy security and a demand for better quality of power from institutions, industries, remote systems, as well as military establishments.
Governments around the world are providing grants and loans for microgrids to increase energy storage and security. Governments are doing so to encourage advances in technology in energy storage systems. A case in point is the growing energy storage market in Americas which can be attributed majorly to its Government’s support.
The California Energy Commission announced US$26.5 million in grants for microgrid projects and Connecticut committed US$15 million in grants to support microgrids at hospitals and police stations in response to two major power outages in 2013.
Several of the most heavily populated countries in the APAC region including China, India, and Malaysia are pursuing rural electrification aggressively. Hence, remote microgrids are one of the most attractive and growing markets in this region.
In the past, remote power stations have traditionally used diesel as their primary source of electricity, but declining costs of renewable energy is providing the necessary fillip for the growth of remote microgrids.
Having established a proven relevance in tunes with the times, The Global Energy Storage Market for Microgrids is witnessing some major trends, which are helping to propel the market at a CAGR of 19 percent from 2013-2018. Technavio analysts have zeroed in on 3 key trends that are influencing energy storage:
Increasing Role of Governments
Governments across the globe are continuously pushing for energy independence and the implementation of environmentally friendly technology. Countries such as Japan and Korea recognize that advanced battery technology is a key component of their competitiveness and provide massive support to the Advanced Batteries industry.
The US recognizes the fact that the country or region that controls and dominates the production of batteries will also ultimately control green vehicle production. Thus, the US is now making efforts to start the development of a manufacturing base for advanced batteries.
In early 2012, President Obama stated his intention to open a new advanced battery research center, which will develop cheaper, longer-lasting batteries. Government support is essential to accelerate the development of this sector, which would otherwise occur only gradually if it were to be left completely to market forces.
Presence of Large Number of Players
The market for energy storage systems in microgrids is characterized by the presence of a large number of vendors. Companies such as Panasonic, Samsung, Sony, and Johnson Controls which specialize in the manufacture of lithium-ion batteries collaborate with solar panel manufacturers and inverter manufacturers to facilitate better functioning of microgrids.
Power-equipment manufacturing companies such as ABB, GE, and Siemens are also actively participating in the market, thereby establishing a strong foothold in the market. For instance, in a recent development, ABB and Samsung won a contract from Australia-based T&D company SP Aus Net to supply hybrid GESS. This will be utilized for supplying power to the distribution network in Australia.
Moreover, a large number of start-up companies are also gradually entering the market. Hence, the level of competition among the players has increased, which is likely to push the growth of the Global Energy Storage for Microgrids market further.
Integration of Renewable Energy Sources into Power Grids
With the support of government initiatives, the integration of renewable energy sources into power grid networks has increased globally. The growing importance of renewable energy in addressing climate change and improving energy security has led to the growth of the industry in recent years.
The integration of renewable energy sources into smart grids and microgrids will help reduce the carbon footprint of the electric power systems. In the US, provisions under the EISA of 2007 and EPA programs will assist in the achievement of renewable energy targets whereas in the EU targets are to achieve a 20 percent share of energy consumption from renewables, which will help increase the share of renewable energy in the total energy mix.
Such a high rate of renewable energy production brings the need for a storage system that provides backup during periods of intermittency or outage. Frequency and voltage regulation, load balancing, and peak shaving are some of the functions of energy storage, which are required for the integration of renewable energy sources into power grids and are of absolute importance in microgrids, which are not grid tied.
