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Leading the Charge: A Brief Analysis of Germany’s Energy Storage Market

published: 2024-04-26 17:16

In 2023, Germany emerged as the leading market for energy storage in Europe. The growth trend across the continent for ESS installations remained robust. According to data from the European Energy Storage Association (EASE), total installations soared to 13.5GWh in 2023, marking a staggering 93% increase compared to the previous year. Particularly noteworthy was the surge in residential battery storage, which reached 9.5GWh, a remarkable 109% year-on-year rise, constituting 70% of the total capacity.

Germany, the United Kingdom, and Italy maintained their positions as the top three markets for energy storage installations in Europe during 2023. As per statistics from TrendForce, Germany, the UK, and Italy added 6.1 GWh, 4.0 GWh, and 3.9 GWh of installations, respectively, during the year.

Looking ahead to 2024, TrendForce anticipates further growth in installations for Germany, the UK, and Italy. Projections suggest an increase to approximately 7.1GWh, 7.7GWh, and 6.2GWh, respectively, representing growth rates of 17%, 92%, and 62%.

European countries add new storage installations from 2023 to 2024

Analysis on Installations in Germany

In 2023, Germany witnessed an unprecedented surge in energy storage installations, solidifying its position as the largest market in Europe. According to TrendForce, Germany saw the addition of approximately 4GW/6.1GWh of energy storage installations, marking a remarkable 124% and 116% year-on-year increase. Notably, residential storage constituted the lion's share, accounting for over 83% and 81% of the total, respectively.

Moreover, Germany emerged as the frontrunner in residential storage installations across Europe. A staggering 555,000 units of residential ESS were installed in Germany in 2023, equivalent to 5.0GWh of capacity, representing a staggering 166% year-on-year growth. These installations contributed significantly, making up 52.6% of the new installations in Europe and driving substantial growth in the European energy storage market.

Germany Adds New Capacity ESS Installations from 2019 to 2024

The expansion of Europe’s energy storage installations has slowed, largely attributed to diminished demand. This trend is exemplified by Germany, the continent's premier energy storage market. In the first half of 2023, new installations experienced a substantial surge, with growth rates typically ranging from 150% to 250%. However, this momentum waned considerably starting from August 2023, with a continuous downward trend thereafter. Notably, December 2023 witnessed a negative growth rate of 23% in terms of new installations.

Factors contributing to this decline include reduced residential electricity prices and increased volatility, alongside higher loan interest rates and other market dynamics. Consequently, the capacity of residential installations in Germany began to diminish notably as of December 2023, with no signs of reaching a turning point as yet.

Installation Types

Residential ESS Continues to Lead in Germany's Energy Storage Landscape

Residential energy storage systems (ESS) maintained their stronghold as the most prevalent installation type in Europe throughout 2023. According to TrendForce data, Germany's energy storage sector predominantly saw the adoption of residential storage solutions. Specifically, new installations of residential storage surpassed 5GWh, capturing a substantial 83% share, followed by utility-scale energy storage and commercial & industrial (C&I) storage, which accounted for 15% and 2% respectively.

Proportion of Germany’s Installations Types

According to Bloomberg NEF, a quarter of the residential photovoltaic (PV) systems installed across Europe in 2023 were equipped with energy storage systems. Notably, residential storage dominates the energy storage landscape in Germany, boasting the highest penetration rate of allocated storage systems at an impressive 78%. Italy follows closely behind, with a penetration rate of 70%. Conversely, the penetration rate of residential storage remains low in other countries.

Note: This article incorporates data from TrendForce’s Database and Report, which provides comprehensive insights into global energy storage market developments, policy analyses, trend projections, corporate strategies, and more.

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