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The residential solar energy storage market size is forecast to increase by USD 113.55 billion at a CAGR of 52.6% between 2023 and 2028. The market is experiencing significant growth due to several key drivers. One major factor is the decreasing costs of solar panel systems and inverters, making renewable energy more accessible and affordable for homeowners. Another trend is the utilization of residential energy storage systems as virtual power plants, feeding excess energy back into the grid and contributing to the shift toward renewable power sources.
Primarily, the market's progression is driven by the decline in photovoltaic (PV) system and energy storage costs. Additionally, the emergence of alternative energy storage technologies is expanding market options. Furthermore, the potential for energy trading and the implementation of blockchain technology offers opportunities for homeowners to monetize their stored energy and reduce their carbon footprints. Overall, these factors are fueling the growth of the market.
The market is experiencing significant growth due to the increasing adoption of renewable energy sources and the need to reduce carbon footprints. Solar energy storage systems have become an essential component of solar PV systems, enabling homeowners to store excess solar energy generated during peak sunlight hours for use during periods of high electricity demand or power outages. Solar panels, a crucial part of solar energy systems, convert sunlight into electricity. The stored energy is typically held in either lithium-ion or lead-acid batteries. Lithium-ion batteries have gained popularity due to their high energy density, long cycle life, and low self-discharge rates.
In summary, energy trading, blockchain, and AI technologies are also being explored to optimize the use of renewable energy and improve the overall efficiency of the energy storage system. Flow batteries, such as vanadium flow batteries, are another emerging technology that offers advantages in terms of longer cycle life and lower environmental impact. The renewable energy ecosystem is expanding to include a wide range of sectors, from hospitals and hotels to schools and rural electrification projects. Zero emission norms and infrastructure projects are also driving demand for renewable energy and energy storage solutions. The market is expected to continue growing as the benefits of renewable energy and energy storage become more apparent.
Additionally, the charge and discharge process of batteries is a critical factor in the performance and efficiency of solar energy storage systems. Advanced battery designs and inverter technologies have improved the charge and discharge efficiency, ensuring that homeowners can make the most of their solar energy. Renewable energy sources, including solar energy, are becoming increasingly popular as an alternative to utility power grids. Energy storage systems enable homeowners to store excess renewable energy and use it during peak demand hours or power outages, reducing their reliance on the utility grid. Virtual power plants and energy trading are emerging trends in the market.
Virtual power plants allow multiple solar energy storage systems to be connected and managed as a single entity, enabling homeowners to sell excess energy back to the grid or to other consumers. Energy trading platforms, powered by blockchain technology, enable peer-to-peer energy transactions, providing homeowners with more control over their energy usage and revenue. The market is experiencing significant growth due to the increasing adoption of renewable energy sources and the need to reduce carbon footprints. Advanced battery technologies, efficient charge and discharge processes, and innovative energy management systems are driving the growth of this market. Virtual power plants and energy trading platforms are emerging trends that are expected to transform the way homeowners manage and monetize their solar energy.
The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD billion" for the period 2024-2028, as well as historical data from 2018-2022 for the following segments.
The Li-ion batteries segment is estimated to witness significant growth during the forecast period. In the residential sector, lithium-ion (Li-ion) batteries have gained popularity for energy storage applications due to their superior performance compared to other battery technologies. Li-ion batteries provide enhanced features, such as longer battery life, better energy density, and improved power range, making them an excellent choice for residential structures. With twice the run time compared to lead-acid batteries, Li-ion batteries offer significant space savings, which is a crucial consideration for many homeowners.
Furthermore, Li-ion batteries boast an efficiency of 80-90% and are well-suited for applications requiring short discharge periods, such as frequency regulation activities. As zero-emission norms become increasingly stringent, the adoption of solar energy in residential structures is on the rise. Hospitals, hotels, hostels, and schools are among the institutions leading this trend. The integration of solar energy and energy storage systems contributes to the green energy ecosystem by reducing greenhouse gas emissions and enhancing the overall sustainability of electric utility services.
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The Li-ion batteries segment was valued at USD 4.43 billion in 2018 and showed a gradual increase during the forecast period.
APAC is estimated to contribute 53% to the growth of the global market during the forecast period. Technavio's analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
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The residential energy storage market in Asia Pacific is poised for substantial expansion over the forecast period. This region presents a vast opportunity for off-grid systems, including solar and energy storage integrated solutions, due to the limited transmission and distribution infrastructure in countries like India and China. Millions of residents in rural areas remain devoid of grid power.
In response, solar photovoltaic (PV) systems and energy storage units capable of powering small communities have been deployed. Notably, there has been a remarkable growth in the installation of solar energy storage systems in countries such as Japan and Australia. These nations are projected to spearhead the residential energy storage market growth in the region.
Our researchers analyzed the data with 2023 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
The reduction in PV and energy storage system costs is the key driver of the market. In today's global energy landscape, there is a significant push towards renewable power generation, leading to the installation of millions of solar photovoltaic (PV) systems worldwide. In countries with feed-in tariffs, solar energy excess is sold back to the grid for a small compensation. Energy storage systems play a crucial role in enhancing the efficiency of solar PV systems by storing excess power for later use. This not only increases the utilization of renewable energy but also reduces the reliance on traditional power sources.
Furthermore, companies in the energy storage industry have been investing heavily in research and development to create cost-effective energy storage solutions. Two common types of energy storage technologies for residential applications are lithium-ion batteries and lead-acid batteries. Electric vehicles (EVs) and virtual power plants (VPPs) can also serve as mobile energy storage units, contributing to the development of virtual power plants. The integration of solar PV systems with energy storage and EVs can lead to a more sustainable and cost-effective energy solution for households.
The residential energy storage as virtual power plants is the upcoming trend in the market. In the United States, the adoption of solar panel systems for residential and commercial use has been on the rise due to the decreasing costs of renewable power sources. However, the intermittent nature of solar energy poses a challenge to the stability of power systems. Solar power generation is influenced by factors such as the efficiency of the Solar panels, solar irradiation, and the degree of shading. These variables can significantly impact power output, making a 100% standalone solar power system impractical. To mitigate this issue, solar energy storage solutions, such as inverters, are increasingly being integrated into solar panel systems.
Additionally, these energy storage systems enable the storage of excess solar energy for use during periods of low solar irradiation or high power demand. Moreover, the integration of renewable energy into the power grid and energy trading through blockchain technology offers opportunities for monetizing excess solar energy. In summary, the use of solar energy storage systems is crucial for maximizing the benefits of solar panel installations while ensuring grid stability.
The availability of alternative technologies is a key challenge affecting the market growth. In the realm of energy storage systems, residential solar energy storage solutions present a promising alternative to traditional power sources, such as diesel generators, and emerging technologies like fuel cells. These systems can serve dual functions: as backup power during outages or as standalone systems, storing excess solar energy for nighttime usage.
However, in rural regions where grid power is absent or inconsistent, diesel generators remain the preferred choice due to their reliability and availability. This trend poses a significant hurdle for renewable energy systems, as their integration with energy storage can offer a sustainable, fossil fuel-free power solution. The design and construction technology of solar energy storage cells play a crucial role in determining their energy density and overall efficiency. Metal resources, a critical component in battery manufacturing, are subject to supply chain challenges and price volatility.
Consequently, the ability to charge and discharge these batteries effectively and efficiently is essential. Energy storage systems, in conjunction with solar rooftop systems, can contribute significantly to the integration of renewable energy sources into the power grid. Overcoming the preference for diesel generators in rural areas requires a concerted effort to promote the benefits of renewable energy storage systems and address the challenges associated with their implementation.
The market forecasting report includes the adoption lifecycle of the market, covering from the innovator's stage to the laggard's stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth analysis strategies.
Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
East Penn Manufacturing Co. Inc. - The company offers residential solar energy storage such as Deka Solar batteries.
The market research and growth report includes detailed analyses of the competitive landscape of the market and information about key companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The residential energy storage market is witnessing significant growth due to the increasing adoption of renewable energy sources like solar panels. Solar PV systems are becoming increasingly popular as they help reduce reliance on traditional electric utility services and decrease carbon footprints. solar rooftop systems are a key component of this trend, as they allow homeowners to generate their own electricity and store excess energy in batteries for later use. Lithium-ion batteries and lead-acid batteries are the most commonly used energy storage technologies in residential applications. Lithium-ion cells offer higher energy density and longer cycle life, making them an attractive option for storing solar energy.
Consequently, construction technology advances have also led to the development of more efficient and cost-effective battery designs. Electric vehicles (EVs) are another driving factor for the residential energy storage market. Virtual power plants, which aggregate the energy stored in multiple residential batteries, can provide grid services and help stabilize the utility power grid. Renewable energy sources, including solar and wind, are becoming more competitive with traditional power sources, leading to increased interest in energy storage systems for both residential and commercial applications. Inverter technology plays a crucial role in the efficient conversion of DC power from solar panels to AC power for use in homes. The integration of solar energy storage systems with smart grids is also gaining popularity, allowing for the efficient distribution and consumption of solar energy. The Residential Solar Energy Storage market is poised for growth due to the increasing demand for renewable energy sources, government incentives, and technological advancements in battery storage systems. Solar energy storage systems provide homeowners with energy independence, backup power, and cost savings, making them an attractive investment for homeowners.
Moreover, the residential solar energy storage market is expanding rapidly, driven by advancements in lithium-ion batteries and lithium-ion cells. These batteries are increasingly integrated into solar energy systems for efficient power storage in homes. The demand for cell design innovations is growing, enabling higher power ratings and better performance in industrial installations as well as residential settings. AI technologies are enhancing energy management by optimizing storage and usage patterns. As remote working continues to rise, households are looking for reliable energy solutions. The market also sees competition from alternative storage technologies like the Vanadium flow battery. Moreover, low carbon energy generation through wind energy and concentrated solar power is driving interest in sustainable residential energy solutions. Urbanization and the increasing adoption of ownership models make solar storage systems a key part of future energy solutions.
Furthermore, The market is rapidly evolving, driven by the integration of lithium-ion batteries and the increasing adoption of solar energy systems. The shift towards sustainable practices is also crucial in reducing greenhouse gas emissions. With a typical power rating of 3 kW - 6 kW, these systems allow homeowners to store excess energy, promoting self-sufficiency and less reliance on the grid. Automation companies are playing a vital role in optimizing these technologies, making them more accessible to consumers seeking eco-friendly alternatives.
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Market Scope |
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Report Coverage |
Details |
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Page number |
155 |
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Base year |
2023 |
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Historic period |
2018-2022 |
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Forecast period |
2024-2028 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 52.6% |
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Market growth 2024-2028 |
USD 113.55 billion |
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Market structure |
Fragmented |
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YoY growth 2023-2024(%) |
40.2 |
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Regional analysis |
APAC, North America, Europe, South America, and Middle East and Africa |
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Performing market contribution |
APAC at 53% |
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Key countries |
China, US, Japan, Canada, and Germany |
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Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
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Key companies profiled |
ABB, ACME Cleantech Solutions Pvt. Ltd., Adara Power, E.ON UK Plc, E3 DC, East Penn Manufacturing Co. Inc., Enphase Energy Inc., Invinity Energy Systems plc, LG Electronics Inc., Mercedes Benz Group AG, Panasonic Holdings Corp., Samsung SDI Co. Ltd., Shell plc, SOLARWATT GmbH, Sony Group Corp., Tesla Inc., The BYD Motors Inc., TotalEnergies SE, Trojan Battery Co. LLC, and Wanxiang New Energy LLC |
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Market dynamics |
Parent market analysis, market growth inducers and obstacles, market forecast, fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, market condition analysis for the forecast period |
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Customization purview |
If our market report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements. Get in touch
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Technology
7 Customer Landscape
8 Geographic Landscape
9 Drivers, Challenges, and Opportunity/Restraints
10 Competitive Landscape
11 Competitive Analysis
12 Appendix
Research Framework
Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key industry influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.
INFORMATION SOURCES
Primary sources
Secondary sources
DATA ANALYSIS
Data Synthesis
Data Validation
REPORT WRITING
Qualitative
Quantitative
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