The total energy storage market is expected to grow to $546 billion in annual revenue by 2035

A new report, Global Energy Storage Market 2019, from Lux Research estimates that the three main drivers of energy storage – mobility applications, electronic devices, and stationary storage – will reach an annual combined deployment level of 3,046 GWh over the next 15 years, up from the current 164 GWh.

The energy storage industry is poised for a massive increase in annual revenue and deployment capacity as key innovative technologies, such as solid-state batteries and flow batteries, reach commercialization. Lux Research expects electric mobility applications, primarily light-duty passenger vehicles, to be the principal long-term driver of energy storage annual revenue and demand, with a total market share of 74% by annual revenue and 91% by annual deployed GWh by the year 2035.”

Growth in revenue and deployment for the energy storage market over the next three years will be markedly different from the overall 2035 projections, with plug-in light-duty vehicles remaining the largest market with a predicted $24 billion increase in revenue by the end of 2022. Medium- and heavy-duty vehicles come in next, growing from $600 million a year in 2019 to a projected $3.6 billion per year in 2022, but have the highest combined annual growth rate (CAGR) of 80%. Residential storage has a CAGR of 76% and $8 billion revenue increase over the next three years, followed by personal mobility devices with a CAGR of $49% and $4.6 billion revenue increase.

Stationary storage is expected to grow to $111.8 billion in revenue by 2035, marking a significant increase from its $9.1 billion revenue in 2019.

The falling cost of stationary storage systems, the rise of renewable energy, and the liberalization of electricity markets around the world will be transformative for energy storage over the next decade and a half. The shift of Li-ion battery manufacturing capacity toward energy-dense chemistries to support the growing electric vehicle industry means that future Li-ion battery cost reductions for stationary storage systems will be modest –2% to 4% annually –compared to historical trends of more than 10%.

The increased value proposition of energy storage in electricity markets will more than make up for a slowdown in cost reductions. Wind and solar will grow to a third of worldwide generating capacity, building opportunities for stationary storage to balance the growth of nondispatchable renewables. Electricity market reform will enable stationary storage to participate more broadly in more regions: By 2035, more than 40% of annual deployments will take place in evolving grids like China, India, Southeast Asia, and Africa.

The report identifies five major technologies that are well-positioned to drive growth in energy storage markets: battery recycling, electric aviation, flow batteries, thin-film batteries, and solid-state battery improvements.