Battery Storage Market Remains Robust in Q1, with Multiple Emerging Markets Blooming

­The global energy storage market remained robust in Q1 2024, with increasing deployments in emerging markets and an acceleration in announcements of 100-megawatt-scale projects. Several countries announced or started construction of their largest ever battery energy storage system (BESS) projects to date. For example,

• Malaysia officially announced its first utility-scale BESS project, with a capacity of 400 MWh.
• Lion Storage announced its BESS project ‘Mufasa’, with a capacity of 364 MW/1,457 MWh, which will be the largest BESS in the Netherlands.
• Neoen and Nidec announced construction of a 9 MW/93.9 MWh BESS – the largest BESS project in both Sweden and all of Northern Europe. It is expected to enter operation in the first half of 2025.

BESS remained the mainstay of energy storage projects over the quarter, with a small number of PHS projects promoted. In addition, there are several noteworthy highlights in different regions.

Fiscal subsidies spur development of BESS in emerging European countries

Leading energy storage countries such as Germany and Italy continued to grow rapidly in the first quarter. According to Interact Analysis, Germany and Italy announced or approved more than 1 GW of BESS projects, respectively. During the same period, the Netherlands officially announced the country’s largest BESS project to date, with a capacity of 364 MW/1457 MWh, which is scheduled to enter commercial operation in 2026.

In addition, it’s worth noting other emerging markets are also accelerating BESS deployments. Though at an early stage, the roll-out of government policies – such as competitive auctions and financing subsidies – is fuelling the deployment of projects. In the first quarter, the Eastern European countries of Poland, Romania, Bulgaria, and the Southern European country of Greece all released tenders for BESS projects.

At the end of 2022, BESS projects were included in the bidding for energy projects in Poland for the first time. In January 2024, the Polish Energy Regulatory Office announced the results of the energy storage tender, and Greenvolt became the biggest winner of the bidding, winning 6 projects with a total of 1.2 GW.

Following the launch of the first round of energy storage project bidding in 2023, Greece announced the winning list of the second round of energy storage project bidding in February this year, which included 11 BESS projects with a total scale of nearly 300 MW. These projects are required to be put into operation no later than December 31, 2025. The Romanian and Bulgarian governments launched their first round of BESS project bidding in February and March 2024, with project scale reaching 240 MW/480 MWh and 350 MW respectively.

In the European energy storage market, Eastern European countries started later than their Western European counterparts. In September 2022, Romania announced a goal to deploy 480 MWh of battery energy storage by 2025. In Poland, the proposal for power market reform was released in March 2023, which encouraged battery energy storage to enter the market and promote investment for the technology. With the increase in energy demand and the goal of carbon neutrality, energy storage projects and supporting policies are now being rolled out in emerging European countries.

Over 3.5GW of energy storage projects announced / approved in Australia

Australia is one of the world’s leading markets for energy storage deployments. According to Interact Analysis, the country announced or approved more than 3.5 GW energy storage projects in the first quarter, of which BESS projects exceeded 2.1 GW, accounting for nearly 60% of the total. These BESS projects are mainly scheduled to commence operation during 2025 and 2026. In addition to the new projects, one project (Crystal Brook) was suspended.

One noteworthy project is the Australia-Asia PowerLink scheme invested in by Sun Cable. As the world’s first intercontinental power grid project, it will transmit part of the electricity generated to Singapore via subsea cables. The project signed a development agreement in January 2021, and in September that year, Sun Cable announced an increase of the battery storage capacity from 20 GWh to 36-42 GWh. The project is scheduled to start construction in 2024 (no start-construction information as of Q1).

Cross-border energy transmission favors BESS construction in Southeast Asia

The Southeast Asian market for BESS (excluding residential applications) is yet to develop. The Philippines is one of the largest energy storage countries in Southeast Asia. In January 2024, its 20 MW Magat BESS project in Isabela (which started construction in Q3 2022) was put into operation. It is the country’s first BESS project to be paired with hydroelectric power. In addition, Tenaga Nasional Bhd announced construction of Malaysia’s first utility-scale (400 MWh) BESS project.

Cross-border transmission of energy is an important factor driving the development of the energy storage market in Southeast Asia. Singapore, which has high energy demand but insufficient land resources, is a major requestor. In addition to the aforementioned project in Australia, Quantum Power Asia and Vena Energy – two Singaporean companies both with large-scale solar-plus-storage projects in Indonesia, accounting for 95% of Indonesia’s new energy storage market in total – will also supply electricity to Singapore via subsea cables.