The energy storage market is growing dramatically

image credit: Siemens Energy
Thorben Fohrmann's picture
Strategic Analyst for Energy Storage, Siemens Energy

Unleashing the potential of energy storage and helping customers to master the energy transition

  • Member since 2021
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  • Oct 1, 2021

The share of renewable energy in our energy mix is constantly increasing, which is ultimately good for combatting climate change. However, as solar and wind availability fluctuates due to weather conditions, we need a solution for ensuring steady energy flow. Energy storage can realize this goal effectively. With this approach, surplus renewable energy can be stored and dispatched when needed. But is this solution currently implemented in the market today and how does it look like in the coming years?

In its “The Energy Storage Grand Challenge Energy Storage Market Report 2020”, the U.S. Department of Energy (DOE) forecasts a 27% compound annual growth rate (CAGR) for grid-related storage through to 2030[1]. It also projects that grid-scale energy storage installations will increase annually from 10GWh in 2019 to almost 160 GWh in 2030 (Figure 1).

Figure 1: Stationary energy storage projections by sector[2]

What are the major market drivers? The technology that utilities and grid operators choose will strongly depend on which one offers the best economic and operational capability according to the services, capacity range, and the energy discharge duration required. All these in turn depend on the grid design and distribution of generating plants and loads that are unique to each grid. Due to their variability, different energy systems are therefore suited for different situations. Let me give you four examples:

  • Li-Ion batteries are currently the technology of choice thanks to their cost-effectiveness and speed characteristics. They offer several applications, such as frequency response, flexibility enhancements of conventional power generation assets, black start capabilities and energy arbitrage. Their sweet spot reaches around 250 MW and 5 hours of duration.

  • Currently, pumped storage hydro, which is the most dominant energy storage solution in terms of globally installed megawatt capacity, represents about 93% of the operating system. As a gigawatt-scale technology mostly employed in energy shifting and high-capacity firming, it offers storage durations of days or weeks with minimal energy losses.

  • Supercapacitors and rotating grid stabilizers (i.e., flywheels and synchronous condensers) provide instantaneous system responses and grid control. Both technologies are aimed at applications within the range of approximately 1-100 MW.

  • Thermal energy storage (TES) can improve utilization of waste heat, assist in the electrification of process heat supply, or store renewable energy for re-electrification using a steam turbine. TES can also be integrated with thermal generation plants, e.g., a combined cycle plant.

The list goes on. Other types also worth mentioning are Liquid Air Energy Storage (LAES) or Compressed Air Energy Storage (CAES), which can be used for easy re-electrification. Both energy storage systems are essential buildings blocks for a new energy future. With these, not only do we have the technologies for building this future, but also the market rightly recognizes their relevance today.


Figure 2: Siemens Energy's Offerings in Energy Storage (copyright: Siemens Energy)


[1] Cp. U.S. Department of Energy, 2020, p. 1.

[2] Cp. U.S. Department of Energy, 2020, p. 8.

Bob Meinetz's picture
Bob Meinetz on Oct 3, 2021

Thorben, in articles discussing energy storage on Energy Central we never find concrete evidence it can reduce carbon emissions - our #1 goal. We often read how "the energy storage market is growing dramatically," or that the U.S. DOE "forecasts a 27% compound annual growth rate (CAGR) for grid-related storage through to 2030," however.

We read assumptions: "The share of renewable energy in our energy mix is constantly increasing, which is ultimately good for combatting climate change....both energy storage systems are essential buildings blocks for a new energy future," but no evidence this is (or may not be) the case. And though you conclude with "the market rightly recognizes their relevance today," unfortunately markets don't recognize relevance - they never have. Markets recognize profitability, and the distinction isn't a trivial one. The question should be, "Is the effectiveness of grid-scale storage at reducing carbon emissions, or the perception grid-scale storage might be effective at reducing carbon emissions, what is driving sales?"

I don't mean to pick on Siemens for marketing its products. That's a characteristic of all successful corporations, and there is no doubt Siemens is a global leader in engineering industrial-scale hardware that serves its customers well. But the goal for Siemens is not to reduce atmospheric carbon, the goal is to sell grid-scale storage and wind turbines. And with climate change, we can't allow ourselves to be seduced by the promise of profitability when environmental health is at stake.

Susanne Weissmann's picture
Susanne Weissmann on Oct 7, 2021

We (Siemens Energy) are convinced that innovative technologies are the most important key to combating climate change, now and in the future. Our goal is a sustainable energy industry and we are actively contributing to this already. Already today we are well on our way to becoming climate-neutral by 2030. We aim to achieve this by transitioning our own electricity consumption to 100 percent green energy by 2023 as well as investing in our own operations. Moreover, the greenhouse gas emissions of our products in the Gas and Power segment (scope 3 emissions) are to be cut by just under a third (27.5%) over lifetime compared to 2019 by 2030. Just a few months ago, the Science Based Targets Initiative (SBTi) has verified on a scientific basis that our CO2 reduction targets comply with the Paris Agreement and thus contribute to limiting global warming to the extent stipulated in the agreement. Another proof point that we are serious about the decarbonization is our decision to stop supporting the construction of new coal-fired power plants. If you want to get more information about sustainability at Siemens Energy, please click here:


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