How many utility-scale storage installations are there in 2022?

While total 2022 installations have not yet been reported, utility-scale storage installations in the second quarter were the largest quarter on record with 1,170 MW installed, despite significant delays in the market.

Can energy storage reduce peak demand?

For such a customer, an energy storage project may allow the customer to reduce its peak demand periods, and thus the associated demand charges, by reducing grid power consumption during its peak periods (so-called “peak shaving”).

How do energy storage contracts work?

For standalone energy storage contracts, these are typically structured with a fixed monthly capacity payment plus some variable cost per megawatt hour (MWh) of throughput. For a combined renewables-plus-storage project, it may be structured with an energy-only price in lieu of a fixed monthly capacity payment.

What is utility-scale storage?

Utility-scale storage is also competing for batteries with the electric vehicle (EV) market. Lithium ion is the most prevalent type of battery technology for utility-scale storage in the United States, accounting for more than 90% of storage installations in both 2020 and 2021. The EV market, however, also relies on lithium-ion batteries.