Energy Storage Market - Global Industry Size, Share, Trends, Opportunity, and Forecast, 2021-2031

The Global Energy Storage Market is projected to expand significantly, rising from USD 28.94 Billion in 2025 to USD 59.42 Billion by 2031, reflecting a compound annual growth rate of 12.74%. This sector encompasses diverse technologies such as batteries, pumped hydro, and thermal storage, all designed to capture electricity generated at one specific time for utilization during periods of elevated demand. The market is primarily propelled by the urgent need to integrate intermittent renewable energy sources into the power mix and the increasing demand for grid stability to avert outages. Highlighting this momentum, the International Renewable Energy Agency reported in 2024 that global investment in energy storage surged to $54 billion, marking a 73% increase over the average investment levels observed in the preceding two years.

Despite this upward trajectory, the market faces substantial obstacles due to the high capital costs required for utility-scale storage deployments. The volatility of prices for essential raw materials, including lithium and cobalt, often results in unpredictable project expenses and heightened financial risks for developers. These economic barriers restrict the viability of large-scale installations in regions sensitive to costs, potentially hindering the global pace of adoption required to achieve energy transition goals.

Market Drivers

The rapid integration of variable renewable energy sources, specifically solar and wind, acts as the main engine for growth in the Global Energy Storage Market. As utility companies phase out fossil fuel plants to adhere to decarbonization goals, the variable nature of renewables demands reliable storage solutions to effectively bridge the gap between supply and demand. These systems are crucial for maintaining grid frequency and shifting energy produced during peak generation times to periods of high usage, ensuring operational continuity. Underscoring this trend, the International Energy Agency’s April 2024 report on 'Batteries and Secure Energy Transitions' noted that battery storage deployment in the power sector more than doubled in 2023, contributing an additional 42 GW of capacity globally.

A second vital factor driving market expansion is the implementation of supportive government incentives and decarbonization mandates. Legislative measures, such as investment tax credits and direct grants, significantly lower the initial financial hurdles associated with storage technologies, thereby making projects economically attractive for developers and utilities. These policies not only subsidize installation expenses but also stimulate domestic manufacturing, which helps streamline supply chains and de-risk long-term investments. For example, the American Clean Power Association’s March 2024 report highlighted that favorable federal policies enabled the U.S. energy storage market to connect 7.9 GW to the grid in 2023, nearly doubling its installed capacity, while the China Energy Storage Alliance reported that global cumulative installed capacity reached 289.2 GW by the end of 2023.

Market Challenges

The expansion of the Global Energy Storage Market is significantly constrained by high capital costs and the price volatility of critical raw materials. Utility-scale initiatives demand massive upfront investments, making them extremely susceptible to financial risks. The unpredictable market conditions for essential inputs like lithium and cobalt lead to fluctuating cost structures, which complicates budget forecasting for developers. When material prices experience drastic swings, stakeholders find it difficult to secure stable financing because lenders often perceive these uncertain expenditures as liabilities, leading to frequent delays or cancellations of projects.

Consequently, these economic barriers restrict the feasibility of installations primarily to wealthy nations that possess established support mechanisms, while limiting deployment in cost-sensitive regions. The inability to ensure fixed project costs prevents these technologies from accessing a broader customer base, effectively excluding developing markets from the scale necessary for growth. According to the International Energy Agency in 2024, emerging and developing economies represented less than 5% of global battery demand, a figure largely attributed to prohibitive upfront capital requirements and financing risks. This financial hurdle isolates vast potential markets and stalls the global momentum essential for a successful energy transition.

Market Trends

The market is undergoing a decisive shift toward higher-density storage solutions, particularly involving the standardization of large-capacity containers that exceed 5 MWh. Manufacturers are focusing on increasing energy density to maximize output within smaller physical footprints, a strategy that directly lowers land acquisition costs and simplifies construction for utility-scale developers. This evolution facilitates more efficient thermal management and reduces balance-of-system expenses, ultimately decreasing the levelized cost of storage for project owners. Illustrating this advancement, Contemporary Amperex Technology Co., Limited announced in April 2024 the launch of the world's first mass-producible energy storage system with a capacity of 6.25 MWh in a single container, achieving a 30% boost in energy density per unit area.

Simultaneously, the commercialization of sodium-ion battery technology is gaining traction as a strategic trend to alleviate raw material volatility and supply chain bottlenecks linked to lithium-based chemistries. Industry stakeholders are increasingly deploying sodium-ion systems because of their superior performance in low temperatures and the widespread availability of sodium resources, offering a more stable long-term cost structure for grid-level use. This diversification is advancing from pilot phases to operational grid assets, confirming the technology's readiness for broader adoption. For instance, in May 2024, China Southern Power Grid successfully commissioned the first large-scale sodium-ion battery energy storage station in China with a total capacity of 10 MWh, marking a significant milestone in scaling non-lithium storage alternatives.

Key Players Profiled in the Energy Storage Market

• ABB Limited
• Siemens AG
• Schneider Electric SE
• Panasonic Corporation
• Johnson Controls International PLC
• Tesla, Inc.
• LG Energy Solution Ltd.
• Samsung SDI Co., Ltd.
• ESS Tech, Inc.
• Fluence Energy LLC

Report Scope

In this report, the Global Energy Storage Market has been segmented into the following categories:

Energy Storage Market, by Technology:

• Pumped Hydro Storage
• Battery Energy Storage
• Compressed Air Energy Storage
• Flywheel Energy Storage

Energy Storage Market, by Type:

• Mechanical
• Thermal
• Electro-Chemical
• Chemical

Energy Storage Market, by End-User:

• Utility
• Commercial & Industrial
• Residential

Energy Storage Market, by Region:

• North America
• Europe
• Asia-Pacific
• South America
• Middle East & Africa

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the Global Energy Storage Market.

Available Customization

The analyst offers customization according to your specific needs. The following customization options are available for the report:

• Detailed analysis and profiling of additional market players (up to five).

This product will be delivered within 1-3 business days.