Europe Energy Storage Systems Market by Application and Type - Forecast and Analysis 2024-2028

Europe Energy Storage Systems Market Forecast 2024-2028

The Europe Energy Storage Systems Market size is forecast to increase by USD 14.78 billion, at a CAGR of 17.87% between 2023 and 2028. The report includes historic market data from 2018-2022. The market is undergoing substantial growth, marked by distinct trends. Notably, there is a rising demand for the expanded adoption of microgrids within battery energy storage systems. The market landscape is further shaped by the seamless integration of various storage technologies, showcasing a progressive approach to cater to diverse energy storage requirements. A significant and unique aspect driving this growth is the increasing demand for a continuous power supply from data centers. 

Market Overview :

• Residential is the fastest-growing segment during the forecast year
• The residential was the largest segment and valued at  USD 3.45 billion in 2018. 
• It also includes an in-depth analysis of the increasing economic benefits of energy storage systems, increased adoption of microgrids in battery energy storage systems, and high initial costs and uncertainty regarding long-term returns of energy storage systems. 

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The market is experiencing exponential growth, driven by diverse factors including the rising demand for battery storage solutions in both the residential and industrial sectors. Technological innovations, particularly in lithium-ion battery technology and compressed air energy storage (CAES), are reshaping the energy storage landscape. The European Commission plays a pivotal role in setting targets and implementing policies to bolster energy storage capacity and enhance the integration of renewable sources. This burgeoning market addresses critical needs such as ensuring uninterrupted power supply and reducing peak demand charges. With a focus on technological advancements and regulatory support, Europe leads in adopting battery energy storage systems for voltage and frequency regulation, cementing its position as a key player in the global electricity storage sector.

Market Largest Growing Segments 

 

The Energy Storage Systems Market in Europe is witnessing remarkable growth driven by increasing demand for renewable capacity. Leveraging lithium-ion technology, innovations in battery systems enhance power generation and grid integration. As the region embraces renewable sources like wind and solar, efficient storage solutions are pivotal for stabilizing electricity supply. This burgeoning market attracts significant investment to bolster infrastructure development, addressing the escalating need for sustainable energy solutions. With emphasis on efficiency and thermal management, Europe leads in adopting advanced energy storage solutions, paving the way for robust growth in the sector.

Residential

The residential segment is estimated to witness significant growth during the forecast period. he residential segment is a significant end-user of low-capacity and medium capacity power storage systems, especially those in the battery energy storage system. Frequent blackouts due to natural calamities, as well as the aging electricity infrastructure in many countries, have led to the increased demand in the residential segment to ensure continuous power supply during fuel outages.

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Further, the surging demand for fuel warehouse systems from the residential segment is attributed to the rising need for an uninterrupted power supply to operate various home appliances, such as heathers, computers, dishwashers, refrigerators, and others. The increasing availability of small and lightweight portable battery energy warehouse systems ensures that all activities can be carried out seamlessly. Automatic start-up and shutdown features of fuel warehouse systems such as batteries and the ability to provide a seamless power supply to household appliances during fuel outages make power warehouse systems a reliable backup power solution. Thus, the increasing need for power backup in residential applications is expected to drive the growth of the residential segment in the market during the forecast period.

Market Dynamics and Customer Landscape

The market is driven by increasing demand for uninterrupted power supply, advancements in lithium-ion battery technology, and government policies promoting renewable integration. The market trends include a surge in the residential sector, industrial sector, and commercial sector adoption, emphasizing compressed air power storage (CAES). Challenges revolve around the supply and demand dynamics of raw materials, fluctuating lithium-ion battery prices, and the need for technological advancements for enhanced power utilization efficiency rates. Key applications encompass voltage and frequency regulation, peak demand charges reduction, backup power supply, and ensuring grid stability amid rising renewable fuel generation.

Additionally, the rapid expansion is seen by increasing demand from both the residential and industrial sectors. Innovations in lithium-ion battery technology are reshaping the landscape, with a surge in battery storage system installations across various projects. As the market matures, system prices are becoming more competitive, attracting greater interest from consumers and bolstering market demand. The European Union's energy and electricity system initiatives are driving significant growth in the EU energy storage sector, positioning Europe as a leader in electricity storage systems. With a focus on sustainability and grid reliability, energy storage installations are poised to play a vital role in Europe's transition to a more resilient and efficient energy system. Our researchers analyzed the market research and growth data with 2023  as the base year, along with the key market growth analysis, trends, and challenges. A holistic analysis of drivers, trends, and challenges will help companies refine their marketing strategies to gain a competitive advantage. 

Key Market Driver

The increasing economic benefits of energy storehouse systems are notably driving market growth. Energy storage systems find widespread application across the commercial, industrial, and residential sectors. In residential settings, these systems serve as power backups, storing solar energy generated during the day for use at night. Utilities deploy them to manage power demand fluctuations. Commercial and industrial buildings leverage power storehouses for cost-effectiveness, particularly in addressing demand charges. With a rise in power demand, peak-hour challenges, and power losses during transmission, these systems prove pivotal.

Moreover, in commercial and industrial setups, where electricity bills include demand charges, energy storage mitigates costs by discharging batteries during peak hours. The growing integration of renewables emphasizes the economic benefits of energy storage, driving increased sales and contributing to the thriving market growth during the forecast period. The uninterrupted power supply, the price of lithium-ion batteries, and the integration of renewable sources play key roles in enhancing the value proposition of power storage systems.

Significance Market Trends 

Increased adoption of microgrids in battery power storage systems is an emerging trend shaping market growth. A microgrid, a localized electricity grid with its generation and storehouse resources, can operate independently or collaboratively with other small power grids. When integrated with the central grid, it becomes a hybrid microgrid, capable of switching between grid-connected and island modes. Microgrids, increasingly utilizing renewable sources like wind and solar fuel, enhance resilience against fuel outages. In the event of a cyber-attack or natural disaster, microgrids can be isolated, ensuring continuous fuel supply. They play a crucial role in commercial and industrial sectors, mitigating downtime risks. Governments worldwide endorse microgrid adoption for their resilience during disasters.

For instance, Solar Power Accelerator AB installed a greenfield microgrid on the European route E6 in June 2023, exemplifying efforts to enhance fuel efficiency and address grid shortages in transportation. This widespread adoption is poised to drive the growth of the market during the forecast period. 

Major Challenges of Market

High initial costs and uncertainty regarding the long-term returns of power storage systems a significant challenges hindering market growth. Potential users are discouraged by the significant upfront costs of infrastructure, equipment, and research required to implement new storage methods. For instance, despite their widespread use, fuel warehouse methods have high setup costs because of the intricate production procedures and the high cost of raw materials. The cost of fuel storage is largely driven by the cost of batteries, especially lithium-ion batteries, which are commonly used for fuel storage methods. In addition to the cost of batteries, there are also installation costs, which include the cost of labor, permits, and any necessary electric upgrades.

Furthermore, it is difficult for stakeholders to precisely forecast economic advantages during the lifespan of these systems due to changing market dynamics, technological improvements, and changing fuel policies that contribute to the uncertainty around the return on investment. The growth of the market in focus is hindered by this financial ambiguity, which deters both public and private sector organizations from committing to widespread adoption. Thus, the high initial cost and economic viability are expected to act as challenges for the market growth during the forecast period.

Market Customer Landscape

The market forecasting research 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 and forecasting strategies.

Customer Landscape

Major Market Companies

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.

BYD Co. Ltd. - The company offers energy storage systems such as MC Cube ESS, Cube Pro, 20ft ESS, Chess Pro.

The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including

• CMBlu Energy AG
• Contemporary Amperex Technology Co. Ltd.
• Deutsche Telekom AG
• EnBW Energie Baden Wurttemberg AG
• Enel Spa
• GS Yuasa International Ltd.
• Iberdrola SA
• Impala
• Innovo Renewables S.p.a.
• Invinity Energy Systems plc
• LG Electronics Inc.
• Panasonic Holdings Corp.
• RWE AG
• Samsung Electronics Co. Ltd.
• Siemens AG
• SSE Plc
• Toshiba Corp.
• TotalEnergies SE
• Wartsila Corp.

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.

Segment Overview

The market report forecasts market growth by revenue and provides an analysis of the latest trends and growth opportunities from 2018 to 2028. 

• Application Outlook
  • Residential
  • Commercial
  • Industrial

• Type Outlook
  • Batteries
  • Pumped storage hydroelectricity
  • Thermal energy storage
  • Flywheel energy storage

Market Analyst Overview

The European energy storage market is witnessing significant growth, driven by the increasing supply and demand of raw materials in the Batteries segment. The installation of renewable power sources is a prominent trend across European Union countries, contributing to the market's expansion. The market dynamics are further influenced by factors such as the need for renewable power deployment and the impact of Russian natural gas imports. Key players like Battery manufacturer Saft and Neoen play pivotal roles in shaping the market landscape. Comprehensive research methodologies, including interviews, secondary research, and insights from paid databases, contribute to precise revenue tracking. This detailed approach involves data triangulation, ensuring accurate market assessments at sub-segments, regional levels, and global levels.

Moreover, the Europe energy storage market is experiencing significant growth driven by the increasing focus on renewable energy generation and the installation of renewable energy sources. The market value is on the rise, with a variety of target products and services catering to this demand. Telephonic interviews and pricing details play a crucial role in understanding market dynamics, while validation ensures the reliability of data. Market volume and average selling price are key metrics indicating market trends. The deployment of renewable energy sources is driving the need for storage systems, providing uninterrupted power supply and supporting grid stability. This growth is further supported by technological advancements and government policies promoting the integration of renewable sources. Moreover, the market is driven by renewable energy deployment, and target products/services. Such factors will increase the market growth during the forecast period.

Market Scope
Report Coverage	Details
Page number	151
Base year	2023
Historic period	2018-2022
Forecast period	2024-2028
Growth momentum & CAGR	Accelerate at a CAGR of 17.87%
Market Growth 2024-2028	USD 14.78 billion
Market structure	Fragmented
YoY growth 2023-2024(%)	17.42
Competitive landscape	Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks
Key companies profiled	BYD Co. Ltd., CMBlu Energy AG, Contemporary Amperex Technology Co. Ltd., Deutsche Telekom AG, EnBW Energie Baden Wurttemberg AG, Enel Spa, GS Yuasa International Ltd., Iberdrola SA, Impala, Innovo Renewables S.p.a., Invinity Energy Systems plc, LG Electronics Inc., Panasonic Holdings Corp., RWE AG, Samsung Electronics Co. Ltd., Siemens AG, SSE Plc, Toshiba Corp., TotalEnergies SE, and Wartsila Corp.
Market dynamics	Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period.
Customization purview	If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized.

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What are the Key Data Covered in this Market Research Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the growth of the market between 2024 and 2028
• Precise estimation of the market  size and its contribution of the market in focus to the parent market
• Accurate predictions about upcoming trends and changes in consumer behavior
• Growth of the market across Europe
• Thorough analysis of the market’s competitive landscape and detailed information about companies
• Comprehensive analysis of factors that will challenge the growth of market companies

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