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Australia Energy Storage Systems (ESS) Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

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  • 127 Pages
  • August 2022
  • Region: Australia
  • Mordor Intelligence
  • ID: 5459016
The Australian energy storage systems market is expected to register a CAGR greater than 7% during the forecast period of 2022-2027. The COVID-19 outbreak had a moderate impact on the Australian energy storage system market as the country witnessed a slight decrease in operational activities as well as delays in the ongoing industrial and commercial projects in H1 2020, which occurred due to the shutdown of the battery manufacturing and installation facilities and labor shortage in several industries. Factors such as supportive government policies and ​government schemes for the energy storage sector are expected to drive Australia's energy storage systems market during the forecast period. However, the lack of domestic battery production and concerns regarding energy storage technology is expected to hinder the market's growth.
  • The battery energy storage system (BESS) type is expected to witness significant growth during the forecast period owing to the rising demand for grid-connected solutions and the increasing adoption of lithium-ion batteries in the renewable energy industry.
  • The development of new advanced batteries and the increasing commercialization of compressed air energy storage (CAES) technology is expected to create several opportunities for Australian energy storage systems (ESS) providers.
  • The growing renewable energy sector is one of the primary drivers of energy storage systems in Australia. This is due to the increasing demand for solar and wind energy sources, which accounted for over 18% of the country's total electricity generation in 2020.

Key Market Trends

Battery Energy Storage Systems (BESS) Expected to Witness Significant Growth

  • Battery energy storage is considered a critical technology in the transition to a sustainable energy system. The battery energy storage systems are used to regulate voltage and frequency, reduce peak demand charges, integrate renewable sources, and provide a backup power supply. Batteries play a crucial part in energy storage systems and are responsible for around 60% of the system’s total cost. ​
  • Lithium-ion batteries have been witnessing a massive demand in the Australian BESS market due to declining prices. Additionally, lithium-ion batteries are expected to hold the most significant share in the battery energy storage market, as they require less maintenance, are light-weight, have a reliable cycle life, and have high energy density in terms of the volume and high charge/discharge efficiency. ​​
  • According to Clean Energy Council, in 2020, approximately 23,796 energy storage batteries with a combined capacity of 238 MWh were installed in Australia, witnessing an increase of 5.19% compared to 2019. ​
  • Furthermore, according to Clean Energy Council, there were 16 ​large-scale batteries under construction by the end of 2020, which represented more than 595 MW of new storage capacity. The battery energy storage systems use utility grids to supply electricity to consumers, which also reduces energy bills. Besides, the battery energy storage systems used in utilities are a cost-effective alternative to conventional infrastructure, especially in helping substations and transmission and distribution (T&D) lines meet the growing demand. These factors are contributing to the growth of the BESS market in Australia.​
  • For instance, in February 2021, CEP Energy announced the largest proposed grid-scale battery project in Australia, with a rated output of up to 1,200 MW. The construction of the grid was anticipated to begin in early 2022 and is expected to be in operation by 2023. Thus, upcoming projects in Australia are likely to boost the demand for battery energy storage systems (BESS) during the forecast period.​
  • Therefore, based on the abovementioned factors, battery energy storage systems (BESS) are expected to witness significant demand in the country during the forecast period.

Growing Renewable Energy Sector Expected to Drive the Market

  • Renewable power is an intermittent energy source. Therefore, electricity storage is essential to maintain the constant power distribution of generated renewable power. Thus, compared to the conventional electricity generation sources, renewable power has a higher need for energy storage. ​​
  • Also, the cost of renewable power generation in Australia is continuously declining, mainly for solar power. The primary reasons behind the falling costs of renewable power generation are innovations in the manufacturing and installation of PV power generation, improved wind turbine materials and designs, and economies of scale. Due to lower costs, renewable energy is becoming competitive and, in some cases, cheaper than conventional power plants. ​​
  • As of 2020, renewable energy sources accounted for 7% of total Australian energy consumption. Also, in 2020, Australia's renewable electricity generation was about 62,917 GWh, which was 12% higher than the entire renewable electricity generation in 2019. Also, in 2020, about 24% of Australia's total electricity generation was from renewable energy sources, including solar (9%), wind (9%), and hydro (6%). ​
  • Moreover, the renewables share in Australia's National Electricity Market (NEM) power generation mix is expected to double to 41% by 2030. With the growing share of renewables, the demand for energy storage applications is also likely to grow during the forecast period.
  • The country's government and the major private players are focusing on developing large-utility-scale renewable power projects. The large-scale solar sector's momentum slowed in 2020, but it added 893 MW of new capacity across 22 projects. Also, the large-scale solar industry is expected to perform strongly in the next couple of years, with 52 large-scale solar farms under construction at the end of 2020.
  • Therefore, based on the abovementioned factors, growth in the renewable energy sector with government assistance is expected to drive the energy storage systems market during the forecast period.

Competitive Landscape

The Australian energy storage systems (ESS) market is moderately fragmented. Some of the major players include Pacific Green Technologies Group, LG Energy Solution Ltd, Tesla Inc., Century Yuasa Batteries Pty Ltd​, and EVO Power Pty Ltd.

Additional Benefits:

  • The market estimate (ME) sheet in Excel format
  • 3 months of analyst support

This product will be delivered within 2 business days.

Table of Contents

1.1 Scope of the Study
1.2 Market Definition
1.3 Study Assumptions
4.1 Introduction
4.2 Market Size and Demand Forecast in USD million, till 2027
4.3 Recent Trends and Developments
4.4 Government Policies and Regulations
4.5 Market Dynamics
4.5.1 Drivers
4.5.2 Restraints
4.6 Supply Chain Analysis
4.7 PESTLE Analysis
5.1 Type
5.1.1 Battery Energy Storage System (BESS)
5.1.2 Pumped-storage Hydroelectricity (PSH)
5.1.3 Other Types
5.2 End User
5.2.1 Residential
5.2.2 Commercial and Industrial
5.2.3 Utility Scale
6.1 Mergers and Acquisitions, Joint Ventures, Collaborations, and Agreements
6.2 Strategies Adopted by Leading Players
6.3 Company Profiles
6.3.1 Pacific Green Technologies Group
6.3.2 LG Energy Solution Ltd
6.3.3 Tesla Inc.
6.3.4 Enphase Energy Inc.
6.3.5 Century Yuasa Batteries Pty Ltd?
6.3.6 EVO Power Pty Ltd
6.3.7 Battery Energy Power Solutions Pty
6.3.8 PowerPlus Energy

Companies Mentioned

A selection of companies mentioned in this report includes:

  • Pacific Green Technologies Group
  • LG Energy Solution Ltd
  • Tesla Inc.
  • Enphase Energy Inc.
  • Century Yuasa Batteries Pty Ltd​
  • EVO Power Pty Ltd
  • Battery Energy Power Solutions Pty
  • PowerPlus Energy