The U.S. Energy Storage Market: Why and Where it is
Like the batteries in your cell phone, utility-scale battery energy storage systems can be charged with electricity from the grid, stored, and discharged when there is a deficit in
The energy storage sector in the United States has been thriving in the past years, with several applications to improve the performance of the electricity grid, from frequency regulation and load management to system peak shaving and storing excess renewable energy generation.
While energy storage is already being deployed to support grids across major power markets, new McKinsey analysis suggests investors often underestimate the value of energy storage in their business cases.
One study found that the economic value of energy storage in the U.S. is $228B over a 10-year period. 27 The 2022 Inflation Reduction Act provided a 30% Investment Tax Credit for energy storage technologies through 2032. Recent legislation reverts this to 2027. 42,46,48
Energy storage systems allow electricity to be stored —and then discharged—at the most strategic times. Today, Lithium-ion batteries, the same batteries that are used in cell phones and electric vehicles, are the most commonly used type of energy storage.
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