A reported 345 MW of new energy storage systems were brought online in the second quarter of 2021, according to the U.S. Energy Storage Monitor report.
That was an increase of 162% over the same quarter in 2020, making the quarter the second-largest on record by megawatts. The report was released by the Energy Storage Association and Wood Mackenzie. It said that market momentum continues to build, with an “unprecedented volume” of storage expected to come online in the second half of the year. Wood Mackenzie said that storage projects representing over $5 billion of investment are expected to come online this year.
The pace of energy storage deployment had slowed in the first quarter as 910 MWh was brought online, following a blistering final quarter of 2020 when around 2,000 MWh was deployed. Even so, the first quarter 2021 performance was an increase of more than 250% over the same quarter a year ago.
A slip for residential
During the second quarter, the residential battery storage market slipped in the second quarter, its first decline in nine quarters reaching back to the fourth quarter of 2018. The report said that equipment constraints, including an ongoing Tesla Powerwall shortage, is hampering the segment’s growth despite a “proliferation” of new residential storage players.
The non-residential segment, made up of onsite storage and community-scale storage, reported a 31% quarter-on-quarter growth in deployments, driven in particular by the growth of the community storage market in Massachusetts.
The report said that the front-of-the-meter (FTM) market deployed 218 MW/729 MWh in the second quarter. California, Texas, and Arizona led the segment. The report said that Arevon/Capital Dynamics’s 100MW/400MWh Saticoy Energy Storage peaker plant replacement in Ventura County, California, contributed most of the megawatts for the quarter. Solar-plus-storage projects in Texas and Arizona also lifted the quarter’s FTM capacity.
The report said that policy support continued to build in the second quarter, with several new state incentives introduced for residential and non-residential storage. The industry awaits the outcome of congressional budget reconciliation action, expected late this year, which could include a solar investment tac credit (ITC) extension and/or standalone storage ITC. The report said that a positive outcome would upgrade the energy forecast across all segments.
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