Trends in Solar and Battery Storage Growth

Was curious enough this afternoon to dive one more time just a bit deeper into the US electricity data sets to see if I could tease out projections of where solar, wind and gas might go? This time I assumed... - Total electricity market growth stays constant (likely low w electrification) - Nuclear + hydro (+biomass) stays as constant fraction of total (~27%) Then looked to partition subsets within fossil and renewables sources. Gas displacement of coal is more mature (stay since 2008), but there is a straight-line trend on solar picking up share relative to wind recently (since 2017). If I just take those at face value, this would suggest... - Wind could still grow ~2x bigger than it is today but peak at ~900k GWh in 2036 - Solar could grow >10x from today to ~27,000k GWh by 2050 - Fossil other than gas (i.e. coal) could be down to pretty much 0 by 2040 - Gas could decline 90% (from 1,700k to 150k GWh) by 2050. Interestingly, implied peak gas for power in absolute terms is pretty much right now. That's just some simple math, not a forecast, but certainly strikes me as possible... ... but likely ONLY if a massive amount of storage (all forms) grows during this period. Decline of gas with renewables only works if we can time-shift supply and demand (likely at several length scales). That critical role of storage is hardly news to anyone in the industry, but helpful to my brain to think in terms of such numbers and time periods. Bonkers or believable? Would love to hear other thoughts on plausibility or implications of such an outlook? Source data for history from Ember: https://lnkd.in/grEcxamr

𝗙𝗮𝗹𝗹𝗶𝗻𝗴 𝗖𝗼𝗺𝗺𝗼𝗱𝗶𝘁𝗶𝗲𝘀 𝗣𝗿𝗶𝗰𝗲𝘀 𝗗𝗿𝗶𝘃𝗲 𝗔𝗱𝗼𝗽𝘁𝗶𝗼𝗻 𝗼𝗳 𝗕𝗮𝘁𝘁𝗲𝗿𝘆 𝗦𝘁𝗼𝗿𝗮𝗴𝗲 As with any industry, the entry of more suppliers and buyers into the market typically leads to a fall in prices, thereby suppressing margins. This dynamic is currently unfolding in the battery storage sector, a critical component of the renewable energy ecosystem. Leading the industry are giants such as #CATL and #BYD, which have recently announced price cuts. Such strategic moves underscore a significant shift towards making battery storage more accessible and affordable, potentially accelerating the adoption of renewable energy at scale. One critical lesson learned, particularly by power markets like CAISO, is the inherent risk of over-reliance on interstate power sharing during peak hours, especially with a heavy dependency on solar energy. This realization brings to light the essential role of battery storage in ensuring a balanced and reliable energy system. 𝗛𝗼𝘄 𝗗𝗶𝗳𝗳𝗲𝗿𝗲𝗻𝘁 𝗠𝗮𝗿𝗸𝗲𝘁𝘀 𝗪𝗶𝗹𝗹 𝗥𝗲𝗮𝗰𝘁 Markets such as ERCOT and CAISO are poised to be grounds for the implementation of utility battery storage, largely due to the attractive returns from an IRR perspective. This financial viability positions them as leaders in the integration of storage solutions. Following closely are regions like the Northeast, which may see a similar trajectory as more renewable sources are introduced. The adoption of renewables is expected to bring about market volatility, necessitating robust storage solutions to maintain grid stability. The Midwest is also on the radar, albeit with a unique set of challenges. Despite the region's critical need for Storage, the continued operation of traditional coal, gas & nuclear units delay this transition. The decision by Michigan to revive its nuclear plant exemplifies the potential for prolonged reliance on conventional power sources. However, securing offtakers will be crucial for financing the shift towards renewable energy and storage solutions. 𝗕𝗮𝗹𝗮𝗻𝗰𝗶𝗻𝗴 𝘁𝗵𝗲 𝗚𝗿𝗶𝗱 𝘄𝗶𝘁𝗵𝗼𝘂𝘁 𝗡𝗮𝘁𝘂𝗿𝗮𝗹 𝗚𝗮𝘀 As storage becomes more cost-effective, its adoption is likely to escalate, prompting questions about the ongoing necessity for natural gas in power generation. The debate around the sustainability and role of natural gas is far from over, despite the compelling case for its continued use in ensuring grid reliability. The crux of the matter lies in determining the extent of storage required to feasibly eliminate natural gas as a primary power market resource. This discussion indirectly raises critical questions about our energy future and the practical steps needed to transition to a renewable-dominant grid, setting the stage for deeper analysis and debate in subsequent discussions. 𝗛𝗼𝘄 𝗺𝘂𝗰𝗵 𝘀𝘁𝗼𝗿𝗮𝗴𝗲 𝗶𝘀 𝗻𝗲𝗲𝗱𝗲𝗱 𝘁𝗼 𝗿𝗲𝗽𝗹𝗮𝗰𝗲 𝗻𝗮𝘁𝗴𝗮𝘀 𝗳𝗼𝗿 𝗽𝗼𝘄𝗲𝗿 𝗴𝗲𝗻𝗲𝗿𝗮𝘁𝗶𝗼𝗻 (𝗻𝗼𝘁 𝗵𝗲𝗮𝘁𝗶𝗻𝗴 𝗼𝗿 𝗲𝗹𝗲𝗰𝘁𝗿𝗶𝗳𝗶𝗰𝗮𝘁𝗶𝗼𝗻)?

𝟮𝟬𝟮𝟰 𝗨.𝗦. 𝗖𝗹𝗲𝗮𝗻 𝗘𝗻𝗲𝗿𝗴𝘆 𝗚𝗿𝗼𝘄𝘁𝗵 𝗮𝗻𝗱 𝗜𝘁𝘀 𝗜𝗺𝗽𝗹𝗶𝗰𝗮𝘁𝗶𝗼𝗻𝘀 Take a look at the latest 2024 projections. 👇 2024 marks a significant leap in U.S. clean energy technologies. Battery storage and solar power are at the forefront. We're looking at... 💡 Battery storage capacity is set to increase by 82%, with projected figures reaching 31 GW, up from the previous year's 17 GW. 💡 40% growth from 93 GW to an impressive 130 GW in solar power. 💡 Even wind power is expected to grow by 5%, reaching 156 GW. In contrast... 💡 Nuclear power shows a marginal uptick of 1%, reaching 97 GW. 💡 Geothermal and hydroelectric capacities are projected to remain static at 3 GW and 80 GW, respectively. 💡 Electricity production from coal is forecasted to reduce by 9%. The broader U.S. power sector anticipates a 3% increase in daily electricity generation year-over-year. Renewables will make up an estimated 24% of the electricity mix from 22% last year. But despite these developments in clean energy... Total U.S. energy-related emissions are only projected to decrease by a marginal 0.1%. The path to net zero won't be an easy one. It will need a smarter grid driven by innovation and expertise. What investments in clean energy do you think will yield the most significant returns by 2030? #innovation #technology #energy #sustainability #electricalengineering Source: Decarbonization Channel ASEC ENGINEERS - Engineering your success, delivering precision and innovation in every project since 1991.

Grid-scale installations remain the powerhouse of the U.S. energy storage market, representing 90% of total installations in 2023, reaching 7.9 GW and 24 GWh for the year. California and Texas led U.S. grid-scale additions in Q4 2023, with California alone accounting for 56% of additions. Meanwhile, the residential storage segment experienced major growth, particularly in California and Puerto Rico, spurred by incentives and policy changes like California's NEM 3.0 solar tariff, which revised California’s net metering framework to encourage residential storage. Texas witnessed increased interest in residential storage post-Winter Storm Uri, while Arizona anticipates rising attachment rates with evolving solar compensation. #Cleanenergy #EnergyStorage https://lnkd.in/gzkBDwHj

This year, over 60 GW of new power generation is expected to be added to the US power grid, on top of the roughly 40 GW of additions in 2023. Most of that new capacity is solar power or battery storage or projects with both. Clean energy is attracting record amounts of capital thanks to a confluence of government support for renewables, beneficial economic conditions, detangled supply chains, long-term electricity demand growth, and the trend to decarbonization. Tax incentives under the Inflation Reduction Act, stable interest rates, lower inflation, ample liquidity for both debt and equity, expanded domestic manufacturing, and strong predicted cash flows are driving investment in wind and solar power generating capacity and in energy storage and transmission. These conditions bolster both new project development pipelines and M&A, including investment in large development platforms to scale growth and in portfolios of existing operating assets. The main bottlenecks today are interconnection queues and permitting, and in some areas lingering supply constraints for manufactured components and labor. It was a pleasure discussing current market trends affecting renewable energy with Jonathan Berke of New Project Media (NPM) on his podcast. We look at capital market conditions for clean energy projects, including inflationary pressures and platform M&A trends, as well as the broader economic and political context. Click here to listen to the new episode of the podcast: https://lnkd.in/guGEuStd