Residential batteries are energy storage devices used in households to store energy from solar panels or grid for use during power outages or at times of high energy costs. They are commonly used for backup power, Energy arbitrage and integrating solar or wind power. Residential batteries find applications in providing uninterrupted, reliable power supply to households and supporting efforts towards cleaner energy transition. The global residential battery market is estimated to be valued at US$ 17.96 Bn in 2023 and is expected to exhibit a CAGR of 9.7% over the forecast period 2024 to 2031, as highlighted in a new report published by Coherent Market Insights.
Market Opportunity:
Energy Storage Needs
One of the major market opportunities for residential battery market is growing need for effective energy storage. With increasing installation of on-site solar panels in residential buildings, there is a rising need for reliable battery storage to make the best use of solar energy generated. Battery storage helps in storing excess solar energy produced during day time which can be utilised at night or when grid facing outages. It supports self consumption of clean energy along with bills savings. Factors like rising electricity costs, grid instability in some regions is driving need for households to efficiently store energy and maintain power backup. This growing demand for residential energy storage presents significant growth prospects for vendors in this market over the forecast period.
Porter's Analysis
Threat of new entrants: Low economies of scale in manufacturing and high initial investment required to enter acts as a barrier.
Bargaining power of buyers: Multiple options available in the market gives buyers leverage to negotiate on price.
Bargaining power of suppliers: Few large battery manufacturers globally supply to this market giving them pricing power.
Threat of new substitutes: Emergence of newer technologies like fuel cells poses a threat.
Competitive rivalry: Intense competition among existing players to gain market share.
SWOT Analysis
Strength: Rising adoption of renewable energy sources driving demand. Battery prices declining enhancing viability.
Weakness: High upfront installation costs remain a challenge. Limited battery lifespan increases total ownership cost.
Opportunity: Growth in residential solar PV installations opening new areas. Initiatives to modernize energy infrastructure presenting scope.
Threats: Trade barriers and tariffs impact supply chains. Stringent environment regulations raise compliance requirements.
Key Takeaways
The global residential battery market scope is expected to witness high growth over the forecast period. Factors such as increasing emphasis on renewable energy integration and benefits like power backup during outages will support expansion.
Regional analysis:
Asia Pacific dominates currently owing to proactive clean energy policies of countries including China and Japan. Rapid urbanization and rising disposable incomes in the region are major drivers. North America is another major regional market backed by tax incentives and subsidies encouraging small-scale solar installations.
Key players
operating in the residential battery market include Tesla, LG Chem, Panasonic, BYD, Contemporary Amperex Technology Co. Limited (CATL), Samsung SDI, and Lumen among others. The market remains fragmented with intense competition among these manufacturers to offer cost-effective and high-performance solutions.
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