Grid-tied energy storage market to grow nine-fold by 2017

Partnerships are key for energy storage technology developers as the demand for grid storage applications grows nearly nine-fold to $10.4 billion in 2017, according to Lux Research.

To address this market, which grew from $200 million in 2012, developers need to find partners that can not only improve their capabilities but also enable access to new markets against a host of competitors. While technology developers seek out large corporations for support, the multinational conglomerates target startups for technology and IP.

“A strong network replete with complementary technologies, material supplies, and avenues to customers can speed up a company’s progress and buffer it against some unpredictable market dynamics,” said Steve Minnihan, Lux Research Senior Analyst and a contributor to the report titled, “Finding the Perfect Partner in the Global Grid Storage Market.”

“However, quantity is no indicator of quality in evaluating a developer’s partnership network, because not all partnerships are created equal,” he added.

Lux Research analysts evaluated 877 organizations and 949 strategic relationships that form the grid storage partnership. Among their findings:

·      Partner or perish environment. In the tumultuous 18 months since September 2011, each of the six market-leading grid storage developers faced at least one major technical or financial issue, with several lower ranking companies seeking acquisitions or packing up and moving east to China. To hedge risks, developers are turning to strong corporate partnerships to stay in business. Having a strong partnership doesn’t guarantee success but averts destruction.

·      Networks support technology developers. Of the 877 companies Lux evaluated in the grid storage network, 718 are linked together in a mega-cluster, while 169 remain on the perimeter alone or in strings of isolated relationships. The vast majority — 725 — are not technology developers but financial, education or government organizations that can help developers build their technological prowess and sales channels.

·      Americas losing global share. The Americas account for 49 percent of the existing grid storage market but will lose ground to 26 percent by 2017, representing a $2.7 billion market. Europe, on the other hand, has a miniscule installed cumulative base of active grid storage projects — worth only $34 million and accounting for a mere 3 percent of the world’s installed capacity. However, its demand potential is expected to grow to $3.5 billion, representing 33 percent of the global demand potential by 2017.

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