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  • Published In : Apr 2024
  • Code : CMI5168
  • Pages :170
  • Formats :
      Excel and PDF
  • Industry : Semiconductors

Market Size and Trends

The residential battery market is estimated to be valued at US$ 12.11 billion in 2024 and is expected to reach US$ 39.18 billion by 2031, growing at a compound annual growth rate (CAGR) of 18.3% from 2024 to 2031.

Residential Battery Market Key Factors

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The growth of the residential battery market is driven by the increasing demand for green energy and grid stability. Rising electricity costs and growing awareness among homeowners regarding energy independence is also pushing the growth of localized and distributed energy storage solutions. Government regulations and policies providing incentives for battery storage installations are further encouraging the widespread adoption of residential battery systems. The deployment of residential batteries is expected to pick up pace over the coming years as their prices continue to decline and technologies improve.

Integration of renewable energy and energy storage

With growing environmental concerns and emphasis on sustainability, many countries have set ambitious renewable energy targets to transition towards cleaner sources of energy like solar and wind. Due to the intermittent nature of these renewable sources, the need for scalable and reliable energy storage to balance power fluctuations is growing. Residential battery storage absorbs excess renewable energy produced during the day, discharging it to power homes in the evening. This helps homeowners lower their carbon footprint and electricity bills by maximizing the self-consumption of on-site clean energy. Moreover, by reducing dependency on the grid during peak hours, battery storage also helps reduce stress on the overall power infrastructure. Several governments now offer substantial subsidies and tax incentives for homeowners to install rooftop solar panels integrated with battery packs. This has encouraged many environmentally conscious consumers to opt for such green home energy solutions.

For instance, in 2021, the price of lithium-ion batteries dropped to USD 123/kWh, marking an 81.58% decline from USD 668/KWh in 2013. While residential energy storage policies are still evolving, countries like the U.S. and Germany are fostering opportunities in local energy storage markets through state and regulatory actions.

Rise of smart home appliances and surge in electric vehicles

Along with sustainability goals, growing digitalization of homes is another key driver for the residential battery market. The proliferation of smart appliances, automation systems, and electric vehicles that require electricity to function has increased the household power consumption manifold. However, meeting peak demand entirely from the grid can get expensive and add unnecessary loads. Here batteries play a vital supporting role by powering such devices seamlessly using stored solar or off-peak grid electricity. For example, batteries allow the convenient charging of electric vehicles at home during non-peak hours and add range assurance. They also ensure reliable backup power for critical smart home accessories like surveillance cameras, internet routers, etc. This dual capability of batteries to optimize self-consumption from rooftop panels as well as power smart homes reliably is motivating more homeowners to invest in individual battery energy storage systems.

For instance, in August 2022, Tesla partnered with Green Mountain Power (GMP) to deploy Powerwalls, Tesla’s home battery pack, in a decentralized manner alongside electric utilities. GMP, a small utility in Vermont, was among the first to adopt Tesla Powerwall.

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