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Energy Storage Association: 35 GW New Storage for US Possible by 2025

Energy Storage Association US gigawatts

The Energy Storage Association (ESA) maps out a path to installing 35 gigawatts of new energy storage in the United States by 2025 in a new white paper developed with Navigant Research. Called “35×25: A Vision for Energy Storage,” the paper details market drivers for storage industry growth as well as the value of a disruption-proof grid.

“Electrification of transportation, data centers, HVAC, communications, industry and manufacturing are driving the need for a more flexible, resilient grid,” the ESA says in an announcement about the white paper. “This electrified economy will rely heavily on a properly functioning grid; disruptions will become even more costly in the future. Even today, it is estimated that power outages, surges and spikes cost more than $150 billion to the U.S. economy every year.”

This year, the country had approximately 0.5 GW of installed energy storage in retail and wholesale markets, according to the ESA. Adding 35 gigawatts by 2025 will require increases in system flexibility and efficiency including more safeguards in the form of on-demand capacity and responsive balancing capability, the white paper suggests.

The white paper looks at the value that increased storage capacity will bring to the country, including C&I customers, such as:

  • Faster, more accurate response within seconds, resulting in $4 billion in cumulative operational cost savings by 2025
  • Enhanced reliability and resilience to reduce disruptions to the grid
  • Customer engagement to help modernize the grid

“By 2025, C&I energy storage will be delivering grid services at a significant scale,” the report says. “Approximately one-third of the C&I energy storage systems will be delivering local services, while the remaining two-thirds are forecast to deliver grid services.”

The ESA also predicts that virtual power plants (VPPs) will become a common platform for C&I storage. “VPPs integrate several types of [distributed energy resources] to provide a more reliable overall power supply such as micro combined heat and power, wind turbines, small hydro, solar PV, backup generator sets, and storage batteries,” the report says. “These dynamic systems can react in real-time to changing customer load conditions in ways that the traditional hub-and-spoke model simply cannot achieve.”

This kind of virtual power plant model usually employs an energy aggregator to own and operate a portfolio of smaller resources and synchronize them as a larger, unified, and flexible resource, the ESA points out. “The VPP market is expected to grow significantly with flexibility and demand response becoming more crucial as the number of variable renewables on the grid continue to increase.”

Reaching 35 GW of new storage in such a relatively short time is extremely ambitious, but the ESA is confident that it can be achieved.

“Grid battery technology is similar to consumer electronics and EVs, so there is a massive economy of scale, coupled with increasing power densities and increasing efficiencies of installation costs. So all-in costs are dropping quickly, up to 50% every three or four years,” ESA CEO Kelly Speakes-Backman told Forbes. “We expect that to continue for some time before it begins to level off.”

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