Residential Energy Storage Market: Current Analysis and Forecast (2022-2028)

Residential energy storage systems consist of a set of batteries that allows the additional electricity for later consumption. In recent times, the residential energy storage market has witnessed significant demand owing to the increasing demand for energy coupled with the aging electricity infrastructure and to maintain the grid stability. Also, the residential energy storage system could be incorporated with renewable energy resources such as solar, wind, and other resources for optimizing performance and lower operational costs. Furthermore, the residential energy storage system provides power at the lower voltage supply and supports energy self-consumption.

The Residential Energy Storage Market is expected to grow at a steady rate of around 22% owing to the increasing demand for energy independence coupled with lower battery prices and technical advancement along with supportive government regulations. Major companies in the market are focusing to provide residential energy storage with technologically advanced features along with product launches, collaboration, and mergers & acquisitions. For instance, in May 2022, Mango Power launched Mango Power Series M which could be incorporated with the solar PV system and support single & triple-phase connections and could be used as the backup gateway and EV charger.

Based on the technology, the market is segmented into lead ion battery, Li-ion battery, and others. The Li-ion battery segment is expected to witness significant market growth during the forecast period due to its high energy density, longer durability, and constant power supply. Also, Li-ion batteries possess a lower self-discharging rate and required lower maintenance compared to other batteries. Furthermore, the Li-ion batteries each cell is about 3.6V which is comparatively higher than other batteries and doesn't require priming. Moreover, the increasing investment and supportive government policies for the manufacturing of Li-ion batteries are expected to support the market growth during the forecast period. For instance, in November 2021, the Indian government launched the PLI (Production Linked Scheme) incentive scheme to support the manufacturing and production of Li-ion batteries at the local level.

Based on the application, the market is bifurcated into the on-grid and off-grid segments. The on-grid segment is expected to witness significant CAGR during the forecast period owing to its increasing utilization in residential buildings. Also, in on-grid energy storage, the energy is directly stored from the power generating station system and extra energy can be delivered to the power company that owns the grid. Furthermore, technological advancements such as solar PV panels, hydrogen/SNG, and electrochemical batteries are expected to boost the on-grid residential energy storage market in the coming time.

Based on ownership, the market is segmented into the utility, customer, and third party. The customer-owned segment is expected to witness significant market growth during the forecast period owing to a reduction in the cost per kilowatt-hour. Also, the customer-owned energy storage system provides the value of having its own storage and power system. Additionally, the increasing uncertainties related to the weather such as a hurricane, storms, and others force power outages and drive the market for the customer-owned residential energy system market. Moreover, the government's support to establish the residential energy storage system is expected to support the market growth. For instance, ITC (Investment Tax Credit) which are applicable for both energy storage system and for renewable energy charging system.

For a better understanding of the market adoption of the residential energy storage industry, the market is analyzed based on its worldwide presence in the countries such as North America (U.S., Canada, and the Rest of North America), Europe (Germany, U.K., France, Spain, Italy, Rest of Europe), Asia-Pacific (China, Japan, India, Rest of Asia-Pacific), Rest of World. Asia-Pacific is anticipated to grow at a substantial CAGR during the forecast period. This is due to rapid urbanization and increasing demand for electricity in the region. Also, the growing investment for the upgradation of grid infrastructure, advancement in battery technology, and several government incentives to promote the residential energy storage system is expected to support the market growth in the region. Additionally, the decrease in the cost of Li-ion batteries, lower manufacturing & production costs as well as lower labor costs in the region is expected to propel the market growth in the region during the forecast period.

Some of the major players operating in the market include: Tesla, Sonnen GmbH, Panasonic Industry, Enphase Energy, VARTA AG, ABB, Siemens AG, Eguana Technologies, BYD Company Ltd., and Eaton.