Energy Energy Storage

Challenges remain in understanding energy storage as an investment

Energy Storage

Discusses challenges in evaluating energy storage as an investment due to its nascency, and argues that energy storage should be considered an investment rather than an expense.

  • Projections suggest energy storage deployments will grow 13-fold over the next six years, from 12-gigawatt-hours in 2018 to 158-gigawatt-hours in 2024.
  • As a nascent industry, battery storage lacks historical data, requiring investors and lenders to familiarize themselves with its unique qualities.
  • Installing energy storage is highly individualized from one project to another. So extrapolating risk and returns from any given asset is not straightforward.
  • Batteries in a storage project have shorter lifespans (10 to 15 years) compared to solar or wind energy assets that may last twice as long.
  • A recent report pins the 2019 levelized cost of electricity storage for Li-ion batteries at $187 per megawatt-hour, a 35% reduction from the 2018 estimate.