US, Japan and South Korea to install 1.4 GW of energy storage between 2015-16

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For the first time, South Korea, Japan and the U.S., respectively, are set to exceed 100 MW of annual energy storage installations, says IHS Inc. Highlighting the lack of commercial energy storage deployment, the three markets are forecast to account for 59% of global installations in 2016.

Sam Wilkinson, solar supply-chain and energy storage analyst for IHS Technology tells pv magazine that between 2015 and 2016, the U.S. will install 650 MW of energy storage, while Japan will see 510 MW and South Korea 280 MW.

"Demand for energy storage in South Korea is driven predominantly by KEPCO’s (state owned utility) frequency regulation programme, which will procure 500 MW of batteries for frequency regulation of the next 4 years," he adds.

Although deployment in other regions will increase next year, most markets are still in the test, pilot and demonstration phases, says Wilkinson. Global growth is expected to be spurred, however, by falling system costs.

These have been driven by decreases in lithium ion (Li-ion) battery prices, which have fallen 53% between 2012 and 2015. Wilkinson says nameplate prices for a complete Li-ion battery module, with no conversion, management or other balance of plant components included, are currently $440/kWh.

According to its calculations, IHS says the cost of a 10 MW/5 MWh battery storage system will come down from around US$11 million in 2013, to under $5 million in 2019. See main image.

Due to "significant competition," prices for storage inverters, power conversion systems (PCS) and other components will also "fall quickly." In a statement released IHS explains, "For a typical 30-minute duration utility-scale li-ion system, more than 60 percent of the total reduction in system costs between 2013 and 2019 will come from the balance-of-plant equipment, rather than from batteries alone."

"The breakdown of system costs, and the future evolution of prices, varies significantly depending on whether the system is configured to provide a high-power or high-energy application," adds Wilkinson, "but battery costs will continue to decline over the next five years."

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