A recent analysis by SolarPower Europe reveals the impressive installation of 17.2 GWh of new battery energy storage systems (BESS) in Europe in 2023.
This rapid growth, representing a 94% increase compared to 2022, marks the third consecutive year of doubling the annual market.
Residential Storage Leads, Germany Dominates the Market
By the end of 2023, Europe’s total operational BESS fleet reached around 36 GWh. The residential segment accounted for 63% of this capacity, followed by large-scale battery systems (21%) and commercial & industrial systems (9%).
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Germany established itself as the market leader, holding 34% of the European market share in 2023, followed by Italy (22%) and the United Kingdom (15%).
Despite forecasts of continued growth in 2024, projections still fall short of the estimated 200 GW of battery power capacity needed by 2030 to unlock the EU’s solar potential.
Battery storage faces obstacles in Europe, including missing targets, insufficient market signals, double taxation, and restrictive grid policies for hybrid renewable installations.
Energy Crisis Impact on Solar Battery Adoption
In 2023, the equivalent of 1.7 million more European homes became solar battery powered. SolarPower Europe’s analysis highlights an impressive 94% increase in newly installed BESS capacity in Europe in 2023 compared to 2022.
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Walburga Hemetsberger, CEO of SolarPower Europe, emphasizes that the growth of battery storage and flexibility represents a fundamental shift from the current grid-centric view of the market.
It impacts not only infrastructure planning and system operation but also the engaged markets. The new Electricity Market Design (EMD) legislation lays the groundwork for a more robust energy policy.
Growth Driven by Residential Batteries
Alongside solar PV, growth was primarily driven by home batteries. Following the energy crisis, European citizens turned to batteries to enhance their energy self-sufficiency.
The residential segment led deployment with 70% of the annually installed BESS capacity, followed by large-scale battery systems at 21% and commercial & industrial systems at 9%.
2023 marks the third consecutive year of doubling the annual market, with total battery storage capacity reaching 35.9 GWh by the end of 2023.
Germany maintained its position as the leading market, deploying 5.9 GWh last year and marking a significant increase of 152%. Italy followed closely, connecting a record-breaking 3.7 GWh (+86%), followed by the United Kingdom with 2.7 GWh (+91%).
Sustained Growth and Challenges Ahead
The BESS markets will maintain an upward trajectory between 2025 and 2028, with sustained, though slower, growth rates in the 30-40% range.
The overall installed BESS capacity in Europe is projected to expand more than sevenfold to reach 260 GWh of battery storage by 2028.
Antonio Arruebo, Market Analyst at SolarPower Europe, points out that decreasing investment costs for battery storage, driven by technological advancements, economies of scale, and lower raw material prices, have significantly improved the cost-competitiveness of solar PV paired with battery storage.
However, with the fossil energy crisis easing, the immediate incentive for European households to invest in self-sufficiency diminishes, potentially reducing the appeal of solar and storage solutions.
Call for a Comprehensive European Energy Storage Strategy
Michael Schmela, Director of Market Intelligence at SolarPower Europe, emphasizes that while policymakers have focused on batteries for electrifying the automotive industry, their critical role in the green transition of the European power system has been largely overlooked.
Flexibility through battery storage is not solely a technical matter for regulators and standardization bodies; it demands immediate political attention and prioritization.
The growth of renewables relies on the adoption of clean flexibility sources like batteries, essential for transportation and heating electrification, as well as grid modernization. SolarPower Europe calls for a comprehensive EU electricity storage strategy and a target of 200 GW by 2030.