US behind-the-meter storage forecast falls 31% on coronavirus fears

From pv magazine USA

Wood Mackenzie's predictions for a record year for behind-the-meter storage in the United States have been tamed, falling 31% due to the ongoing impact of the Covid-19 pandemic.

In the company’s most recent Energy Storage Monitor report, experts predicted that 632 MW of behind-the-meter storage would be installed in 2020, up 232% growth from 272 MW in 2019. Commercial installations were expected to account for 212 MW of the total, with the remaining 420 MW to come from residential batteries. In 2019, 133 MW of commercial batteries were installed, along with 139 MW of residential batteries.

With the 31% decrease in mind, that brings the new 2020 outlook to around 430 MW, which is still a more than 100% increase over 2019.

If decreased deployment projections weren’t somber enough news, there is also concern for projects that will get completed due to the delays they will still face. Wood Mackenzie doesn’t echo increasingly common concerns about supply chain disruptions – at least as far as batteries are concerned. It is focused more on the role of commissioning and interconnection in a period of shelter-in-place ordinances.

“This has led to project delays and additional costs which, if they continue long enough, will lead to projects missing crucial deadlines – such as ITC qualification – which could destroy project economics,” said Brett Simon, Wood Mackenzie senior research analyst. “Some developers were forward-thinking enough to build longer delivery timelines into their contracts, giving them some wiggle room given delays from the original proposed commissioning date that they expect to be able to meet. However, we expect these problems to exacerbate as permitting agencies begin to pull back personnel and further government mandates limit individual movement and travel.”

This forecast contradicts the concerns of Texas behind-the-meter solar and storage installer Bret Biggart. Biggart, one of the “forward-thinking” developers to prepare for potential shortages, says that he has enough product in-house to operate as-is for another two months.

As for shelter-in-place ordinances, Biggart is dealing with that on a municipal level, as the four main markets he operates in – Houston, Dallas, Austin and San Antonio – all have instituted policies beyond that of the state.

“Shelter-in-place ordinances generally have a carveout for businesses that provide critical infrastructure support,” Biggart shared. “We consider ourselves to be a critical grid infrastructure provider.”

Wood Mackenzie shares that “most North American storage developers source batteries from Asian manufacturers, which are ramping back up as coronavirus impacts abate in manufacturing hubs.” The company does also note, however, that there is uncertainty around the supply of components manufactured in North America and that “a delay of even a few days for product delivery can cause reverberations.”

The report also mentions the challenges of selling batteries and reaching customers during a pandemic – a well-documented issue.