Global electricity demand is set to more than double by mid-century, relative to 2020 levels. With renewable sources – in particular wind and solar – expected to account for the largest share of power output in the coming decades, energy storage will play an important role in maintaining the balance between supply and demand. Investments in energy storage worldwide reached three billion U.S. dollars in 2020, and the market is forecast to continue growing. Pumped hydro, hydrogen, batteries, and thermal storage are a few of the technologies currently in the spotlight.
How does energy storage work?
Electricity demand oscillates throughout the year and across the day, usually peaking in the winter months and at nighttime. In contrast, solar electricity generation, for example, is at its highest during the daytime, when demand is frequently low. Energy storage can provide more flexibility to the electricity grid, guaranteeing a more efficient use of resources. When supply is greater than demand, excess electricity can be fed into storage devices. It can in turn be tapped hours (or sometimes even days) later, when demand is greater than supply. Although progress has been slow in recent years, energy storage deployment worldwide is expected to pick-up in the coming decade. In 2020, around 29 gigawatt hours had been deployed worldwide. By 2030, the cumulative capacity is forecast to surpass 700 gigawatt hours.
Types of energy storage technologies
There is a wide range of energy storage technologies available, but they can usually be divided into five major categories, depending on their working principle: mechanical, electrochemical, compressed air, thermal, and chemical. Mechanical technologies, in particular pumped hydropower, have historically been the most widely used large-scale energy storage. In 2021, global pumped storage hydropower capacity surpassed 130 gigawatts, with China, Japan, and the U.S. combined accounting for half of this value.
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