FLOW BATTERY MARKET ANALYSIS

The global flow battery market size was valued at US$ 736.8 million in 2022 and is anticipated to witness a compound annual growth rate (CAGR) of 12.8% from 2023 to 2030. The global flow battery market is expected to grow at a rapid pace during the forecast period due to technological innovations and developments. Besides, the focus on improving grid systems will further boost the growth of this market. Moreover, the safety features of flow batteries and their ability to store active materials away from the reactive point source will also enhance the growth of this market

Global Flow Battery Market: Regional Insights

Asia Pacific among regions is anticipated to gain a major share in the global flow battery market during the forecast period. This is attributed to rise in Rapid industrialization and urbanization, and government support and incentives energy in the region. The rapid growth of industries in Asia Pacific requires reliable and uninterrupted power supply. Flow batteries offer a scalable and efficient energy storage solution to meet the high-power demands of industries, ensuring smooth operations and reducing downtime. Furthermore As cities expand and populations concentrate in urban areas, the demand for electricity rises significantly. Flow batteries help meet this increasing energy demand by storing excess energy during low-demand periods and releasing it during peak times, reducing strain on the grid and improving grid stability.

Figure 1: Global Flow Battery Market Share (%), By Region, 2022

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Global Flow Battery Market Drivers:

Rising adoption of renewable energy to drive the market growth

The importance of energy storage is rapidly increasing in the power industry majorly owing to rise in investments in renewable energy sector. The use of lithium-ion batteries is widespread, however, flow batteries have promising advantages for long-term use and in applications that need regular cycle throughout the day. With flow batteries, renewable energy such as wind and solar energy can be made accessible for longer period in order for countering major intermittency issues. These technologies are actively being evaluated by developers for their ability to offer power for longer time period and for ramping up and down with no degradation. Thus, this factor is expected to support growth of the global flow battery market over the forecast period.

Investments in aspiring wind and solar energy targets to fuel the market pace

As per the International Energy Agency, the renewable electricity capacity in the world is likely to grow by more than 60% by 2026. According to the same source, renewable energy are likely to contribute nearly 95% to the rise in global capacity of power by 2026, with solar PV being the major contributor. The number of solar photovoltaic projects installed is growing all over the world rapidly owing to growing investments in the renewable energy sector. Thus, this factor is further anticipated to boost growth of the global flow battery market over the forecast period.

Global Flow Battery Market Opportunities:

Increasing development of advanced and novel flow battery chemistries to create ample of opportunities in the global flow battery market over the forecast period. The flow battery market is on the rise constantly, due to which several companies and researchers from around the world are focusing on development and investment in novel battery chemistries for the flow battery in terms of higher power density and low cost. For instance, in January 2021, scientists from the University of Burgos in Spain, the University of West Bohemia Pilsen in Czechia, the University of Padua in Italy, and the Basque Research and Technology Alliance (BRTA) performed a detail analysis of all hybrid redox flow batteries and redox flow batteries. Such development activities are anticipated to create growth opportunities in the market over the forecast future.

Growing residential applications of flow batteries are expected to offer multiple growth opportunities. The adoption of solar PV systems in residential applications has been growing significantly in past few years, owing to their capability of reducing electricity cost and greenhouse gas emissions. However, solar PV systems are sometimes unsuitable for grid integration due to the unpredicted fluctuations in the harvested solar energy occurring due to intermittent nature of solar irradiance. The battery energy storage system is an alternative to solar PV systems. Flow batteries offer maximum energy storing, prevent blackouts, and reduce energy cost for homes and small businesses. Thus, the use of flow batteries is growing in residential applications and it is likely to create growth opportunities in the market.

Global Flow Battery Market Trends:

Increase in popularity of vanadium redox flow batteries is a growing trend

Vanadium redox flow batteries are redox flow batteries that can store energy using V2+/V3+ and V4+/V5+ redox pairs of vanadium in the positive and negative half-cells respectively. The power and energy ratings of these batteries are not linked with one another and each of them is optimized for a different type of use. Several countries are working on increasing their energy needs without gaps. Thus, several energy storage systems are being used in renewable energy systems as well as stand-alone energy systems. This trend is likely to continue in the global flow battery market over the forecast period.

Growing number of renewable energy projects is another trend in the market

In renewable technologies, natural resources are used for generating electricity. Green energy requires novel technologies and development of renewable energy sources is leading to growing need for energy storage systems in order for storing the electricity generated through these sources. As a result, the demand for energy storage systems such as flow batteries is on the rise. This trend is thus expected to support growth of the global flow battery market over the forecast period.

Global Flow Battery Market Restraints:

Decline in cost and rise in adoption of lithium-ion batteries to impede the market growth

Lithium-ion batteries and flow batteries offer renewable energy storage solutions. The use of both types of batteries offers more efficient demand management, which results in lower charges of utility and lower peak electrical demand. The major differences between lithium-ion batteries and flow batteries are power density, cost, and space efficiency. Thus, the demand for lithium-ion batteries is increasing, which in turn is expected to hinder growth of the global flow battery market over the forecast period. However, with increasing developments in flow battery technology, the market is likely to gain substantial growth in the near future.

Need for high capital investment for flow battery production to hamper the market growth

Flow batteries have become a promising alternative for traditional batteries including lead-acid battery, lithium-ion battery, and sodium-based battery. However, the initial investment required for manufacturing of these flow batteries is high. The overall cost includes material, component, installation, maintenance and repair cost. This can an extensive investment for SMES. Thus, this factor is expected to hinder growth of the global flow battery market in the coming future.

Figure 2: Global Flow Battery Market Share (%), By Type, 2022

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Global Flow Battery Market Segmentation:

The global flow battery market report is segmented into Type.

Based on Type, the market is segmented into Vanadium Redox Flow Battery, Zinc Bromine Flow Battery, Iron Flow Battery, and Zinc Iron Flow Battery. Out of which, Vanadium Redox Flow Battery is expected to dominate the global market over the forecast period and this is attributed to the increase in demand for vanadium redox flow batteries (VRFB), especially in the mini-grid, off-grid, and utility markets. Several companies around the world are involved in rapidly commercializing vanadium redox flow batteries, to cater the increasing demand. This in turn is expected to support growth of this segment.

Zinc Bromine Flow Battery segment is also expected to witness significant growth in the near future and this is owing to the rise in demand for energy storage, owing to storage of renewable energy leading to growing need for battery energy storage solutions. The low cost of materials is making Zinc Bromide Flow battery technology a leading alternative to other flow batteries. Thus, the R&D activities around the technology is expected to drive growth of this segment.

Global Flow Battery Market: Key Developments

In July 2022, VRB Energy announced to have commissioned the first stage of an 800 MWh flow battery in China.  The first stage of this project includes a 100MW/400MWh vanadium redox flow battery energy storage system.

In January 2022, ESS Tech Inc. deployed its long-duration batteries for commercial and utility-scale energy storage applications, which is a project by SDG&E (San Diego Gas & Electric). This will be reinforcing the SDG&E microgrid project with backup resources in California.

In July 2022, Redflow Limited introduced its Gen3 batteries making its first potential commercial sale. The company received a contract for providing 56 Gen3 zinc-bromine flow batteries as part of the novel hybrid renewable energy system.

In December 2022, Invinity Energy Systems and Everdura Technology Business signed a reseller agreement. Everdura has accomplished a first buying order for 15 MWh vanadium flow batteries from Invinity under the agreement.

Global Flow Battery Market: Key Companies Insights

The global flow battery market is highly competitive. This is attributed to continuous launch of new technologies due to ongoing R &D and efforts by value chain participants. Moreover, key players are adopting various business growth strategies in order to expand their presence on regional as well as global basis. Some of the key players in the global flow battery market are VRB Energy, H2 Inc., ESS Tech Inc., Stryten Energy, Vanadis Power GmbH, CellCube Energy Storage Systems Inc., Primus Power Corporation, Dalian Rongke Power Co. Ltd., RedFlow Ltd., and Invinity Energy Systems PLC.

*Definition: A flow battery is an electrochemical storage system that uses differences in oxidation states of metals to store energy. Redox flow batteries are rechargeable electrochemical energy storage systems used for enhancing grid stability and to reduce power supply interruptions.