Battery storage and hybrid power plants show strong growth in the U.S.

Recent years have witnessed remarkable advancements in the development of battery energy storage systems (BESS) and hybrid power plants in the United States. According to numerous studies and reports, the installed capacity of BESS in the country has been consistently expanding and is projected to maintain this upward trajectory in the coming years.

By the end of the third quarter of 2023, the cumulative installed capacity of BESS in the US reached 14.689 gigawatts (GW), with ERCOT, the grid operator in Texas, contributing 40% of the newly added capacity for this quarter. By the end of 2023, the cumulative installed capacity of BESS in the US is anticipated to reach 17 GW. In the long run, Wood Mackenzie forecasts that the growth rate of BESS deployment in the US over the next decade will surpass that of wind or solar power facilities, potentially exceeding 20 GW by 2030.

Regarding market size, the North American BESS market is projected to reach 3.91billionby2024andsoarto15.28 billion by 2029, with a compound annual growth rate (CAGR) of 31.28% during the forecast period (2024-2029). This rapid expansion is primarily fueled by declining lithium-ion battery prices and increased renewable energy penetration.

Furthermore, the demand for BESS varies across US states. For instance, California boasts a significantly higher average duration of continuous discharge for its BESS, exceeding 4 hours, compared to other regions. California, Texas, Illinois, Massachusetts, and Hawaii collectively account for over 70% of the total installed capacity of BESS in the US.

Concurrently, the development of hybrid power plants in the US is also accelerating. As of the end of 2021, the total generating capacity in the US was 1,143 GW, with 3% originating from hybrid power plants. Hybrid power plants integrate diverse generation methods (such as wind and solar) or combine generation with energy storage to enhance energy efficiency and reliability. For instance, the Stillwater Geothermal Solar Hybrid Project in Fallon, Nevada, is the world's first of its kind, contributing to the diversification of the nation's energy mix and mitigating environmental pollution.

Policy support plays a pivotal role in driving the development of BESS and hybrid power plants in the US. The federal government has introduced a series of measures, such as extending the Investment Tax Credit (ITC) policy to hybrid projects involving new energy and energy storage, offering up to a 30% tax credit on upfront investments. This has incentivized the integration of energy storage in new energy power plants. Additionally, the "National Blueprint for Lithium Batteries 2021-2035" aims to establish US leadership in battery technology and encourage scientific research and STEM education.

Overall, the US exhibits robust growth momentum in the development of BESS and hybrid power plants. With technological advancements and policy support, these sectors are poised for continued rapid development in the coming years, significantly contributing to the country's energy transition and sustainable development goals.