The global cumulative energy storage capacity is forecasted to reach 650 gigawatts (or 1,877 gigawatt-hours) by the end of this decade, according to a new analysis by BNEF.

The new forecast marks a considerable increase in the research house’s previous estimate. In March this year, it anticipated the capacity to reach 508 GW/1,432 GWh by 2030, and a year previously, the predictions were 411 GW/1,194 GWh, Kallanish finds.

BNEF highlights that the world’s annual energy storage additions will grow at a compound annual growth rate of 27% to reach 110 GW/372 GWh by 2030 – 2.6 times higher than expected 2023 installations. 

“Targets and subsidies are translating into project development and power market reforms that favour energy storage,” explains BNEF. “Our increase in deployments is driven by a wave of new projects prompted by energy shifting needs.”

The Asia Pacific (APAC) region will continue to take the lead to account for 47% of the capacity additions in 2030, according to the new report. Within this, China will continue to be the world’s largest energy storage market, primarily due to mandatory requirements to combine storage with utility-scale wind and solar.  

Meanwhile, Europe, Middle East and Africa (EMEA) will account for 24% of annual energy storage deployments by 2030, reaching a cumulative capacity of 114 GW/285 GWh, led by the UK, Germany, Italy, Greece, and Turkey. The Americas, on the other hand, will represent 18% of the gigawatts deployed by the end of this decade.

In terms of technology, BNEF said lithium-ion batteries with nickel manganese cobalt (NMC) chemistries are “losing market share” due to their higher costs compared to lithium iron phosphate (LFP) batteries. Furthermore, the case for alternative battery technologies focused on long-duration energy storage (LDES) remains “limited,” with 1.4 GW/8.2 GWh of commissioned capacity worldwide.