US energy storage market installed capacity reached 18.3MW in the first quarter of 2016

According to GTM Research’s survey statistics and the latest monitoring by the U.S. Energy Storage Association, the installed capacity of the U.S. energy storage market increased to 18.3MW (21.2MWh) in the first quarter of 2016, a year-on-year increase of 127%, but a decrease of 84% compared with the peak in the fourth quarter of 2015.

The U.S. energy storage market maintained a relatively slow growth trend in the first quarter. However, both on an annual and quarterly basis, residential energy storage grew significantly, with more than 8.9MW of energy storage devices used in meter billing.

Although the residential energy storage market is the smallest, it is also the most geographically distributed. In the first quarter of this year, the "other" energy storage field dominated the report, with deployments in Kentucky, Nevada, Utah, Vermont and 19 other states. PJM (excluding New Jersey) continues to dominate grid-level energy storage deployment, and California still maintains its first position in the non-residential energy storage field.

“The slow start to 2016 is not surprising, but it is indicative of a correction in the U.S. energy storage market,” said Ravi Manghani, lead author of the report and chairman of energy storage at GTM Research. “After a rush to install energy in PJM based on internal targets in the second half of 2015, this year will see a shift to California becoming the primary market, even for utility-scale energy storage projects. This shift will undoubtedly be accelerated by increased demand for energy storage due to natural gas shortages in Southern California (Aliso Canyon gas leak).”

In addition to energy storage deployment and price trends, the report also covers some changes and developments in the supply sector. Earlier in May, oil and gas company Total announced that it would acquire battery manufacturer Saft for $1.1 billion, which was also its first transaction in the energy storage field worth more than $1 billion. Through its previous acquisition of SunPower, Total has already formed a leading position in the field of renewable energy + energy storage.

GTM Research predicts that by 2021, the US energy storage market will grow to more than 2GW.