The decade of energy storage has arrived

The energy storage decade has arrived. That is, at least according to energy market analysts BloombergNEF (BNEF)’s forecast there will 1 terawatt-hour (TWh) of batteries installed around the world by 2030. To be clear, 1 terawatt-hour is an extremely large number of batteries, but the BNEF analysis is a bit more specific: it finds that 358 gigawatts/1,028 gigawatt-hours will be the precise figure.

Okay, those big numbers might not be quite clear either, but for the record, 1 TWh is more than twenty times larger than the current amount of battery storage installed around the world (17 GW/34 GWh). And here is a number we can all understand, or at least, fantasise about, US$262 billion, that’s the amount of investment in stationary energy storage that the Bloomberg team predicts this upscaling will require.

Charging to 2030

What’s behind all these big numbers is that the era of energy storage has finally arrived. “This is the energy storage decade,” said Yayoi Sekine, BNEF’s head of decentralised energy. “We’ve been anticipating significant scale up for many years and the industry is now more than ready to deliver.”

According to BNEF, the United States and China will be leading the charge (pun intended) with more than half of all storage installations by 2030, but Australia is also tipped to make a significant contribution. In fact, the Asia-Pacific region is expected to lead the storage build out on a megawatt basis to 2030, with the Americas leading on a megawatt-hour basis.

One of the sectors Australia is set to shine in is solar-plus-storage for both residential and commercial and industrial (C&I) installations. BNEF forecasts residential and C&I battery storage systems to make up approximately 25% of installations by 2030. The drivers of this massive uptake? Customers want the energy independence and security that can only be provided by a complete home solar and storage system.

So, it comes as no surprise that Tesla recently announced it has reached over 250,000 installations of its Powerwall.

Why now?

So why is the energy storage decade upon us now? BNEF cites the continuing fall of battery costs in combination with the “surging” penetration of renewable resources like solar. This two-punch combo makes energy storage, particularly battery storage a “compelling flexible resource in many power systems.”

Consumer behaviour also plays a role, and, here too, Tesla has played a decisive role. Electric vehicles (EVs) were a promising technology for a long time and EV proponents had long espoused their advantages. However, the transformation of EVs from boxy, geek-ware, to a highly sought after and eye-turning possession has seen the number of them on our streets accelerate.

And more EVs means more batteries, which makes them more affordable. Within industry, there is a phenomenon known as the “learning curve”. Essentially it means that as manufacturers make more of a product, they get better at making it, and it becomes cheaper.

The price of lots of different end products have been influenced by a learning curve. Computers are perhaps the best known in this respect, and what’s known as Moore’s Law describes the exponential improvements in the field of computer memory as more computer chips were made. And these improvements deliver the ever-faster, thinner, and lighter computers in our lives – including the smartphone in your pocket.

A value can also be given to the learning curve within a specific industry – as was first done with Moore’s Law. The production of solar panels is a good example of an impressive learning curve rate, with each doubling of solar panel production resulting in a decrease of costs between 28% and 36%.

While it’s early days for batteries, it’s clear that their production is benefiting from a strong learning curve. Estimates for this curve are still unsettled, but academics believe it is somewhere in the region of 20% to 24% for the types of batteries used in Tesla vehicles and their stationary battery products.

So, as battery-powered cars got cool, we bought more of them, making all sorts of batteries cheaper. And as the company has both created and supplied this demand, Tesla has changed the game for batteries the world over.

Looking back to the end market for batteries, in Australia, the nation’s world leading rooftop solar uptake and the concordant expiring feed-in tariffs (FITs), subsidies and concerns over grid resilience are also playing a part in consumer uptake of solar-plus-storage solutions. The CSIRO predicts that by 2050, up to 60% of rooftop solar owners will have installed a battery energy storage system also, though considering the rapid change occurring in the energy storage market, highlighted by BNEF’s 2030 forecast, this Australian prediction could wind up being quite conservative.

The above forecast from energy market analysts IHS Markit is similarly buoying. The one thing more and more people seem to be agreeing on is that allying your home solar system with a residential battery is the simplest way to take care of your energy security and find independence from the threats of global price hikes and an increasingly fickle grid.


These costs are based on the SA Power network in Adelaide but prices may vary depending on your circumstances. This comparison assumes a general energy usage of 4000kWh/year for a residential customer on Energy Locals Time of Use Tariff – (TOU – Peak, Off-Peak & Solar Sponge).

The reference price is set by the Australian Energy Regulator (AER) for a financial year in relation to electricity supply to residential customers in the distribution region and is based on an assumed annual usage amount. Any difference between the reference price and the unconditional price of a plan is expressed as a percentage more or less than the reference price. The terms of any conditional discounts are shown, along with any further difference between the reference price and the discount applied if a condition is met, expressed as a percentage more or less than the reference price.