U.S. Energy Storage Market Breaks Record for Megawatts Deployed in a Single Quarter, Growing 232% Year-Over-Year

BOSTON Mass. and WASHINGTON D.C. (June 4, 2019) The United States non-residential storage market had its strongest quarter ever in Q1 2019, according to the new U.S. Energy Storage Monitor from Wood Mackenzie Power & Renewables and the U.S. Energy Storage Association (ESA). Q1 2019 was also the second strongest quarter on record for the U.S. residential storage segment.

Overall, Q1 2019 was the largest ever single quarter for U.S. energy storage deployments in megawatt terms, an increase of 232 percent year-over-year. The quarter was the second largest ever in megawatt-hour terms. The U.S. saw 148.8 megawatts of energy storage deployed in Q1 2019, breaking the previous megawatt record set in Q4 2018 by six percent.

“These first quarter numbers indicate that 2019 will be a banner year for energy storage in the United States,” said ESA CEO Kelly Speakes-Backman. “It’s become clear that states are already unlocking the potential of storage by passing legislation and creating regulatory frameworks to encourage energy storage deployment. The industry is responding by developing storage projects and creating jobs in their states.” California once again led the U.S. storage market in Q1 2019, while Arizona, New Jersey and New York also posted strong growth. State level regulatory activity, such as the Value of Distributed Energy Resources (VDER) proceeding in New York state and the Solar Massachusetts Renewable Target (SMART) Program in Massachusetts, continue to spur pipeline buildout in these states and position them for substantial growth in the next few years.

“Based on activity this quarter, we’re keeping an eye on New York state,” said Wood Mackenzie Power & Renewables senior energy storage analyst Brett Simon. “When the New York bridge incentive opened at the end of April 2019, the first block of the retail incentive was fully subscribed in a little over a week, showing how much pent up storage demand there was in New York. New York also updated its VDER program to guarantee greater certainty for compensation under the program’s value stack, which is a boon for energy storage projects in the state.”

Federally, FERC declined to rehear Order 841 and denied extensions for compliance, demanding that transmission organizations meet the original late 2019 deadlines.

Behind-the-meter (BTM) deployments, which include residential, commercial and industrial storage, constituted 46 percent of Q1 2019 deployments in megawatt terms in Q1, growing 36 percent quarter-over-quarter and 138 percent year-over-year. Front-of-the-meter (FTM) storage also grew significantly year-over-year. Wood Mackenzie notes that there is now five times as much FTM storage in the U.S. than there was at the end of Q1 2018.

An increasing proportion of new FTM and BTM solar projects are being paired with storage, which is helping to drive the market forward. Although some supply constraints strained the storage market in 2018, ongoing resolution of those constraints are contributing to this year’s market uptick.

Wood Mackenzie expects U.S. energy storage deployments in 2019 will be double those seen in 2018. Multiple large FTM projects will come online in 2020, leading to a tripling of the market from 2019 to 2020.

Key findings from the report:

  • 148.8 MW of energy storage was deployed in the United States in Q1 2019, growing 6% QOQ and 232% YOY
  • 271.1 MWh of storage was brought online in the United States in Q1 2019, a 110% rise YOY
  • Behind-the-meter (BTM) storage deployments constituted 46 percent of Q1 2019 U.S. energy storage deployments in MW terms in Q1 2019
  • Front-of-the-meter (FTM) storage deployments constituted 54 percent of Q1 2019 deployments in MW terms in Q1 2019
  • In Q1 2019 FTM storage deployments dropped 10% QOQ in MW terms but rose over 5x YOY

The most recent version of the Energy Storage Monitor is available here.

About U.S. Energy Storage Monitor:

Delivered quarterly, the U.S. Energy Storage Monitor is the industry’s only comprehensive research on energy storage markets, deployments, policies and financing in the U.S. These in-depth reports provide energy industry professionals, policymakers, government agencies and financiers with consistent, actionable insight into the burgeoning U.S. energy storage market. www.energystoragemonitor.com

About Wood Mackenzie:

Wood Mackenzie, a Verisk Analytics business, is a trusted source of commercial intelligence for the world's natural resources sector. We empower clients to make better strategic decisions, providing objective analysis and advice on assets, companies and markets. For more information, visit: www.woodmac.com or follow us on Twitter @WoodMackenzie

WOOD MACKENZIE is a trade mark of Wood Mackenzie Limited and is the subject of trade mark registrations and/or applications in the European Community, the USA and other countries around the world.

About the U.S. Energy Storage Association:

The U.S. Energy Storage Association is the national trade association dedicated to energy storage, working toward a more resilient, efficient, sustainable and affordable electricity grid – as is uniquely enabled by energy storage. With more than 170 members, ESA represents a diverse group of companies, including independent power producers, electric utilities, energy service companies, financiers, insurers, law firms, installers, manufacturers, component suppliers and integrators involved in deploying energy storage systems around the globe. More information is available at: www.energystorage.org.

Media Contacts:

Chloe Holden, Wood Mackenzie Power & Renewables, chloe.holden@woodmac.com

Tori Montano, on behalf of ESA, tori@teamsilverline.com