ENERGY STORAGE SYSTEM MARKET SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2025-2032)

Energy Storage System Market Size and Trends - 2025 to 2032

The global energy storage system market is estimated to be valued at USD 52.95 Bn in 2025 and is expected to reach USD 86.76 Bn by 2032, exhibiting a compound annual growth rate (CAGR) of 7.3% from 2025 to 2032.

Key Takeaways

• Based on Technology, the Pumped Storage segment is expected to lead with 35.8% share of the market in 2025, offers reliable, cost-effective large-scale energy on demand.
• Based on End User, the Grid Storage segment is expected to hold 33.8% share of the market in 2025, driven by utilities’ need for large-scale, economical energy solutions.
• Based on Region, Asia Pacific is set to lead the energy storage system market with 48% share in 2025. While, North America is anticipated to be the fastest growing region.

To learn more about this report, Download Free Sample

Market Overview

Widespread emphasis on renewable energy sources and need for effective management of intermittent power supply from renewable sources is accelerating the deployment of energy storage systems. Favorable government policies and incentives promoting the adoption of clean energy through energy storage applications will further boost the market growth in the coming years. Transition towards decentralized grids and growing consumer preference for energy independence is also supporting the market growth globally.

Current Events and its Impacts on the Energy Storage System Market

Uncover macros and micros vetted on 75+ parameters: Get instant access to report

Is Global Energy Storage Scaling Differently Across Regions in 2025?

India

• Installed energy storage capacity reached 490 MWh by June 2025, with Karnataka, Chhattisgarh, and Gujarat leading deployments.
• Growth slowed in H1 2025 (48.4 MWh added, down 74% YoY) due to project delays and weak tender activity.
• Technologies: Pumped hydro (policy support), lithium-ion for solar + ESS, and emerging sodium-ion systems.

China

• Commissioned 200 MW / 800 MWh semi-solid-state BESS in 2025, showcasing advanced battery chemistry.
• China dominates global ESS installations, with >50% of new capacity additions worldwide.
• Heavy reliance on pumped hydro (largest globally) and rapid scaling of grid-scale lithium-ion.

Japan

• Tokyu Construction commissioned 4 MW BESS in 2025.
• Japan focuses on smaller distributed storage to stabilize its renewable-heavy grid.
• Strong government support for hybrid solar + storage projects.

Canada

• Construction began on Canada’s largest BESS at 1,858 MWh in 2025.
• Focus on utility-scale lithium-ion to complement hydroelectric generation.

United States

• Texan utility issued RFP for 500 MW battery storage in 2025.
• Ford launched a battery storage business to power data centers and the grid.
• U.S. grid-scale battery capacity projected to exceed 30 GW by 2030.

Europe

• EU targets 200 GW of storage by 2050.
• Reliance on pumped hydro and growing lithium-ion deployments.
• Germany and Spain leading in hybrid renewable + ESS projects.

Segmental Insights 

To learn more about this report, Download Free Sample

Energy Storage System Market Insights, By Technology: Pumped Storage: A Mature and Reliable Option for Large-Scale Energy Needs

In terms of technology, the pumped storage segment is expected to contribute 35.8% share of the market in 2025, due to its ability to handle massive amounts of energy on demand. Pumped storage works by pumping water from a lower reservoir to an upper reservoir during off-peak times when energy demand is low. This stored water is then released to generate hydroelectric power during peak demand periods, providing a reliable and cost-effective way to meet large energy needs.

For instance, in June 2025, At the Tehri complex in Uttarakhand, GE Vernova built India's first variable-speed pumped storage hydropower unit. The 250 MW unit makes the grid more flexible, helps with integrating renewable energy, and increases the capacity for storing energy. When it's done, the project will produce 1 GW, making Tehri India's largest hydropower station.

Energy Storage System Market Insights, By End User: Grid Storage Dominates Due to Vast Energy Capacity Needs

In terms of end user, the grid storage segment is expected to contribute 33.8% share of the market in 2025, due to the immense energy capacity required by utilities and power grid operators. Meeting the diverse electricity demands of populations and industrial sectors requires large-scale energy storage solutions. Technologies such as pumped hydro, compressed air, and grid-scale lithium-ion batteries are currently the most economical options to handle substantial energy capacities. 

For instance, in December 2025, Hithium released the world's first native energy storage solution that lasts for 8 hours and works in all weather conditions. The long-lasting lithium-ion system makes grid storage reliable, which helps with renewable integration and stability. This breakthrough is an important milestone forward in building sustainable energy infrastructure and meeting the world's needs for clean power.

Regional Insights 

To learn more about this report, Download Free Sample

Asia Pacific Energy Storage System Market Analysis & Trends

Asia Pacific is projected to lead the energy storage system market with 48.0% share of the market in 2025, driven by supportive government policies, tax incentives in countries like India, China, and Japan, and significant investments in renewable energy projects. The region's dominance is further bolstered by its status as a major hub for lithium-ion battery innovation, with leading companies spearheading research and development in advanced battery technologies essential for energy storage.

For instance, in December 2025, In Sabah, Borneo, Malaysia opened its first large-scale battery energy storage system. The project makes the grid more reliable, helps integrate renewable energy, and makes the region's energy security stronger. The system is an enormous advance toward sustainable power and modern energy storage in Southeast Asia. It is the first of its kind in the region.

North America Energy Storage System Market Analysis & Trends

North America exhibits the fastest growth and is expected to dominate future expansion. Strong government backing for clean energy development to reduce fossil fuel import dependence as well as cope with increasing power demands is a major factor. Nations such as the U.S. and Canada have ambitious targets for renewable capacity additions over the coming years, necessitating energy storage deployment to support intermittent renewable sources.

For instance, in December 2025, A Texas utility has put toward a Request for Proposal for 500 MW of battery energy storage. The goal of the major initiative is to make the grid more reliable, help renewable energy sources work together, and make energy more resilient. This project is a significant advance toward building more clean energy infrastructure in Texas and bringing its power system up to date.

Energy Storage System Market Outlook for Key Countries

The U.S. Energy Storage System Market Trends

The U.S. energy storage system market is led by California with its robust policies to achieve carbon neutrality and modernize the electric grid. Companies like Tesla and Fluence have established a sizable presence supporting the state's clean power goals. The U.S. energy storage system market is experiencing rapid growth, driven by federal incentives and state-level policies. For instance, data published by The Conference of the Parties (COP) in 2023, the global energy storage capacity reached approximately 230 GW. According to Bloomberg NEF estimates, this capacity is forecasted to reach 650 GW by the end of this decade. However, the current installed capacity and projected trends are not sufficient to ensure a green energy transition.

For instance, in December 2025, Ford announced that it intends to establish a new business that stores batteries to power data centers and the electric grid. The automaker's role in clean energy infrastructure grows with this initiative, which offers large-scale energy storage solutions that improve grid reliability, support the integration of renewable energy, and make energy more resilient across all sectors.

China Dominates Energy Storage System Market with Record Growth and Cost Reductions

China leads the global energy storage system market, with substantial investments in renewable energy and storage solutions. For instance, in December 2025, China Green Development has hired a company to build a 200 MW / 800 MWh semi-solid-state battery energy storage station. The project is an important advancement forward in advanced grid-scale storage, making it easier to use renewable energy, more reliable, and safer. This milestone shows that China is a leader in using next-generation energy storage technology to help build a sustainable power infrastructure.

India Accelerates Energy Storage System Market Growth with Policy Support and Major Investments

India continues to lead on the policy front with schemes boosting renewable capacity addition and interest in energy storage from both central and state governments. Reliance Industries is investing heavily in battery manufacturing to gain a foothold. India is actively advancing its energy storage capabilities through a series of government initiatives under the National Energy Storage Mission (NESM). In August 2023, the Ministry of Power released a comprehensive framework aimed at facilitating the development and deployment of ESS across the country. The framework outlines objectives such as improving grid reliability, supporting renewable energy integration, and fostering innovation in energy storage technologies.

Canada Advances Clean Energy Transition with Major Energy Storage Investments

Canada is investing in energy storage projects to support its clean energy transition. The country is focusing on integrating energy storage solutions to enhance grid reliability, manage peak demand, and facilitate the integration of renewable energy sources. In 2023, Ontario is developing the Oneida Energy Storage Project, a 250-megawatt (MW) battery storage system. This project, a collaboration between the Six Nations of the Grand River Development Corporation, Northland Power, NRStor, and Aecon Group, is set to become Canada's largest battery storage facility. It will enhance grid stability and support renewable energy integration.

For instance, in November 2025, Canada's largest battery energy storage system, which can hold 1,858 MWh, is now being built. E-Storage is both a technology provider and an EPC contractor. The project will make the grid more reliable, help with the integration of renewable energy, and be an important advance forward for Canada's clean energy infrastructure and move to more sustainable power.

Japan Prioritizes Energy Storage for Renewable Energy Growth and Energy Security

Japan is focusing on energy storage to support its renewable energy expansion and ensure energy security. The government has implemented policies and incentives to promote the adoption of energy storage systems, aiming to balance the intermittent nature of renewable energy sources and reduce reliance on fossil fuels. HDRE, a Taiwan-based company, entered the energy storage system in Japan market by securing a 20-year government subsidy for its decarbonization initiatives. The company plans to build 1.5 GW of energy storage systems in Japan over the next three years, involving a capital investment of approximately US$ 1.50 billion.

In December 2025, Tokyu Construction has ordered a 4 MW battery energy storage system to be built in Japan. The project makes the grid more stable, helps with the integration of renewable energy, and makes sure that power is always available. The system is a small but important step in Japan's transition to clean energy. It improves modern energy storage infrastructure across the country.

Market Concentration and Competitive Landscape 

To learn more about this report, Download Free Sample

Market Report Scope 

Energy Storage System Market Driver

Increasing demand for renewable energy sources and grid stability

The global energy landscape is changing rapidly. There is increasing awareness about the need to transition to cleaner forms of energy to reduce carbon emissions and tackle climate change. As a result, many countries such as the U.S., Canada, and China have set ambitious renewable energy targets and are investing heavily in infrastructure to promote the use of renewables such as solar and wind power. However, one of the key challenges of renewable energy is that its generation is variable and depends on factors like availability of sunlight and wind speed.

Energy Storage System Market Opportunity

Growth of electric vehicles (EVs) driving demand for storage solutions

One major opportunity for this market is the rapid growth expected in the electric vehicles industry. As EVs become more popular with consumers, worldwide EV sales are projected to increase drastically over the next decade. This rise in EVs on roads will spur demand for large-scale stationary storage solutions that can charge EV batteries and also feed power back to the grid during periods of high energy demand. Auto companies and utilities are already partnering to deploy vehicle-to-grid (V2G) technology that uses EV batteries for energy storage networks. Furthermore, governments and businesses are supporting widespread EV adoption through incentive programs, regulations, and investment in charging infrastructure. 

Energy Storage System Industry News

• In June 2025, Cummins India Limited has started making battery energy storage systems to power India's grid. The goal of the initiative is to make the grid more reliable, help renewable energy sources work together, and make the energy system more resilient. By using large-scale storage solutions, Cummins helps India move toward clean energy and modernizes the country's sustainable power infrastructure.

• In September 2024, the Tokyo Energy Storage Plant Investment Limited Partnership, a collaborative government-industry fund co-managed by ITOCHU Corporation, secured over US$51.69 million from 11 investors. This fund is dedicated to advancing battery energy storage projects, highlighting the synergistic efforts between Japan's public and private sectors in the energy domain.

• In December 2023, Itochu Corporation, a prominent Japan-based conglomerate, partnered with a U.K.-based Gore Street Capital to launch Japan's first dedicated Battery Energy Storage System (BESS) investment fund. This fund focuses on developing grid-scale energy storage projects across Japan, marking a significant step in the country's energy storage sector.

Key Takeaways from Analyst

The energy storage system market is rapidly moving from pilot use to large-scale use. This is due to more renewable energy is being used and the grid needs to be more flexible. In 2024, global installations reached about 175 GWh, showing strong growth in utility-scale, commercial and industrial, and behind-the-meter applications. Most of the new capacity comes from grid-scale projects, which are needed for frequency regulation, peak shifting, and renewable firming.

Lithium-ion batteries remain the best technology for short-term storage since they are very efficient, can be deployed in modules, and can be set up quickly. At the same time, pumped storage hydropower still makes up the largest portion of all the installed storage energy in the world, especially for balancing over long periods of time and during the seasons. China and the United States add the newest things each year. Europe, Australia, the Middle East, and Latin America are all becoming high-growth markets due to changes in the law and programs to modernize the grid.

The economics of projects have gotten better since battery system costs are going down, balance-of-system designs are getting better, and project utilization rates are going up. But profitability continues to be very much tied to revenue stacking, which is the combination of capacity payments, ancillary services, and energy arbitrage. People are becoming more interested in long-term storage technologies like flow batteries and compressed air, but they cannot be utilized on a large scale yet because there aren't enough places to put them and getting permission takes too long.

Energy storage is becoming a key part of the grid instead of just an extra technology. The size of the deployment and the variety of technologies used are going to influence how resilient the power system is in the long run.

Market Segmentation

• Technology Insights (Revenue, USD Bn, 2025 - 2032)
• Pumped Storage
• Electrochemical Storage
• Electromechanical Storage
• Thermal Storage
• End User Insights (Revenue, USD Bn, 2025 - 2032)
• Grid Storage
• Residential
• Commercial
• Industrial
• Regional Insights (Revenue, USD Bn, 2025 - 2032)
• North America
• U.S.
• Canada
• Latin America
• Brazil
• Argentina
• Mexico
• Rest of Latin America
• Europe
• Germany
• U.K.
• Spain
• France
• Italy
• Russia
• Rest of Europe
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• ASEAN
• Rest of Asia Pacific
• Middle East
• GCC Countries
• Israel
• Rest of Middle East
• Africa
• South Africa
• North Africa
• Central Africa
• Key Players Insights
• Tesla, Inc.
• LG Chem Ltd.
• Samsung SDI Co., Ltd.
• Panasonic Corporation
• BYD Company Limited
• Siemens AG
• ABB Ltd.
• Schneider Electric SE
• Fluence Energy, Inc.
• Eos Energy Enterprises, Inc.
• Enphase Energy, Inc.
• AES Corporation
• Saft Groupe S.A.
• Varta AG
• Kokam Co., Ltd.

Sources

Primary Research Interviews

• Energy Storage System Manufacturers (Battery, Thermal, Mechanical)
• Battery Cell & Module Manufacturers
• ESS System Integrators & EPC Companies
• Grid Operators & Utility-Scale Storage Developers
• Renewable Energy Project Developers
• Energy Storage Technology Consultants
• Others

Databases

• Bloomberg Terminal
• Thomson Reuters Eikon
• Factiva
• Others

Magazines

• Energy Storage News
• Power Engineering Magazine
• Battery Technology Magazine
• Renewable Energy World
• Electrical India Magazine
• Others

Journals

• Journal of Energy Storage
• Journal of Power Sources
• Energy & Environmental Science
• Applied Energy
• Renewable & Sustainable Energy Reviews
• Others

Newspapers

• Financial Times
• The Wall Street Journal
• Reuters
• Bloomberg News
• The Economic Times
• Others

Associations

• Energy Storage Association (ESA)
• International Energy Agency (IEA) – Energy Storage Programme
• International Renewable Energy Agency (IRENA)
• Global Battery Alliance (GBA)
• European Association for Storage of Energy (EASE)
• Others

Public Domain Sources

• U.S. Department of Energy (DOE) – Energy Storage Program
• International Energy Agency (IEA)
• International Renewable Energy Agency (IRENA)
• National Renewable Energy Laboratory (NREL)
• European Commission – Directorate-General for Energy
• World Bank Open Data
• Others

Proprietary Elements

• CMI Data Analytics Tool
• Proprietary CMI Existing Repository of Information for the Last 8 Years