Energy storage sets record in 2022 for installed capacity

Approximately 4.8 gigawatts (GW) of energy storage capacity was installed across all segments of the industry in 2022, making it a record year for installed capacity, according to the latest U.S. Energy Storage Monitor.

The 4.8 gigawatts (GW) of capacity was nearly equal to the 5 GW installed in both 2020 and 2021 combined, stated the report, which is produced by the American Clean Power Association and Wood Mackenzie.

“Energy storage had its best year yet in 2022. Cumulative operating utility-scale storage capacity increased by 80%. While we saw a slight dip in installations toward the end of the year, the trend is clear: Energy storage is on a rapid growth curve and is already a key component of building a resilient grid that supports abundant clean energy,” John Hensley, American Clean Power Association (ACP) vice president of research & analytics, said.

In the fourth quarter, the market added 1,067 megawatts (MW) across all segments. However, that was 33 percent lower than the fourth quarter of 2021, which is the highest on record.

The U.S. grid-scale, or utility-scale, segment installed a total of 848 MW in the most recent quarter, which was down from more than 1 GW of installations in both Q2 and Q3 of this year. The decline was largely caused by supply chain and interconnection constraints. These headwinds have also slowed the project pipeline, as more than 3 GW of projects scheduled to come online in the quarter were either delayed or canceled.

The residential storage segment had far better results. It broke a record with 171 MW installed in the fourth quarter, up 11 percent from the third quarter. Capacity installations increased for this segment every quarter in 2022.

Further, the community, commercial, and industrial (CCI) storage segment saw a big jump in the latest quarter, rising 78 percent over the previous quarter with 48 MW installed.

“Despite a slow fourth quarter, total 2022 installations were still 44 percent over 2021. Grid-scale installations increased by 7 percent year-over-year, CCI by 3 percent, and residential experienced the strongest growth, with installations up 36 percent. Looking ahead, we expect the U.S. storage market to install almost 75 GW between 2023 and 2027. Grid-scale installations account for approximately 60 GW, 81% of the new capacity added,” said Vanessa Witte, senior analyst with Wood Mackenzie’s energy storage team.

ACP and Wood Mackenzie forecast capacity for the grid-scale and CCI segments to more than double in 2023 due to robust storage demand as well as projects that were delayed from 2022 coming online. In addition, they expect residential capacity to increase by approximately 88 percent in 2023. Looking further out, they expect four times more residential storage to be installed in 2027 compared to 2022 volumes.