U.S. Residential Energy Storage Market Size & Share Analysis - Trends, Drivers, Competitive Landscape, and Forecasts (2024 - 2030)

U.S. Residential Energy Storage Market Trends & Growth Drivers

Community Energy Storage Systems Are Trending

• Community energy storage (CES) is a recently developed smart grid technology that provides distribution grids with numerous benefits in terms of operationality, reliability, quality, and control.
• This newly developed technology provides benefits to both consumers and utilities, which is why it has become a critical element of microgrids.
• It stabilizes the variable output of distributed energy resources (DERs), such as photovoltaic and wind power plants, by supplying energy from high-capacity batteries.
• CES systems are often placed at the periphery of the grid, close to DERs.

Increasing Sales of Electric Vehicles Are Key Market Driver

• The increase in the sales of EVs is boosting the demand for solar and storage systems in the U.S.
• EV owners are installing at their homes for power generation, to charge their vehicles, thus minimizing the overall operational cost.
• The U.S. government is encouraging EV owners to install high-capacity batteries, as the charging of vehicles from the grid is increasing the load on it.
• As per the International Council on Clean Transportation, yearly EV sales in the U.S. stood at over 1 million units for the first time in 2023.

High Cost of Installment and Replacement Is Biggest Restraint

• The initial investment associated with energy storage systems is high; although, the government provides some relaxations on taxes on their purchase and installation.
• Solar panels are made of glass and are, thus, fragile. They could potentially break, leading to the need for replacement, which can also be costly due to the silver used in these systems.
• Homeowners who want to achieve self-sufficiency in electricity must keep in mind the initial costs of installation and the further expenses on maintenance or replacement.

U.S. Residential Energy Storage Market Analysis

Ownership Insights

• The customer-owned category is the largest, holding a share of 45% in 2024. Customer-owned energy storage systems result in reduced electricity bills and provide a sense of self-sufficiency and resilience during power cuts.
• They allow customers to effectively manage their power usage.
• The government is promoting the installation of solar panels and other cleaner sources of renewable energy by providing subsidies, which is driving the purchase of energy storage systems by citizens themselves.
• The utility-owned category will advance at the highest CAGR during 2024–2030.
• These systems aid electricity providers in reducing their operational costs.
• They provide financial benefits to both parties, home or landowners and the utility firm.

The ownership types covered in the report include:

• Customer-Owned (Largest Category)
• Utility-Owned (Fastest-Growing Category)
• Third-Party-Owned

Connectivity Insights

• On-grid is the larger category in 2024. With on-grid systems, the additional energy generated from renewable sources, such as solar panels, can be transferred to the utility owner, and the cost of the transferred units of electricity is adjusted in consumers’ electricity bills.
• The on-grid category is also the faster-growing, advancing at a CAGR of 28.3% during 2024–2030. This is ascribed to the increase in the awareness of customers of the benefits of using on-grid energy storage systems, primarily with respect to feed-in tariffs.

The following connectivity types are included in the report:

• On-Grid (Larger and Faster-Growing Category)
• Off-Grid

Utility Insights

• The 6 to 10 kW category dominates the market with a share of around 50% in 2024.
• It is also the fastest-growing category, advancing at a CAGR of 28.6% during 2024–2030.
• Residential energy storage systems rated between 6 and 10 kW can provide long-duration, stable power, and they are ideal for fulfilling the energy demands of an average home.

The following utilities are covered in the report:

• 3 to 6 kW
• 6 to 10 kW (Largest and Fastest-Growing Category)
• Above 10 kW

Technology Insights

• The lithium-ion category holds the larger share, of 70%, in 2024, and it is the faster-growing category too during 2024–2030.
• This can be ascribed to the longevity and reliability of lithium-ion batteries and their ability to be charged hundreds of times.
• These batteries can operate at higher voltages, and they have a greater energy density than SLA variants.
• Lithium-ion batteries can also be recycled and disposed of easily, safely, and in an eco-friendly manner, making them a popular choice among customers.

The following technologies are covered in the report -

• Lead–Acid
• Lithium-Ion (Larger and Faster-Growing Category)

Operation Type Insights

• Standalone systems are the larger category in 2024. These systems fulfill the basic purpose of providing power backup during a grid outage. Electricity can be stored in this system when the home’s consumption of it is lower than the supply.
• Since this system fulfills the basic necessity of power backup and is not integrated with solar panels, it is cheaper and easier to install, operate, and maintain.
• The solar and storage system category will advance at the higher CAGR, during 2024–2030. An increasing number of people in the U.S. are adopting solar energy storage systems for sustainability and electricity cost-saving. A large number of the residential energy storage systems in the U.S. homes are paired with onsite solar power generation facilities.
• By using this system, power can be generated for residential houses, villas, and farmhouses located in remote areas with no or limited grid connectivity.

The following operation types are covered in the report:

• Standalone (Larger Category)
• Solar and Storage (Faster-Growing Category)

Competition Analysis

The U.S. residential energy storage market is fragmented in nature due to the presence of a large number of players. Several strategies are being used by the major players, such as mergers and acquisitions, partnerships, and collaborations, to edge out the competition.

Moreover, several companies are expanding their product portfolios to meet the growing demands of consumers.

U.S. Residential Energy Storage Industry News

• In April 2024, Tesla launched Powewall3, which is optimized for high power and easy installations. Moreover, it is equipped with a system controller and solar inverter.
• In February 2022, Enphase Energy announced a strategic partnership with Swell Energy, allowing IQTM batteries and IQTM microinverters to participate in Swell’s virtual power plant projects in New York, California, and Hawaii.
• In July 2023, Panasonic Industry Co. Ltd. introduced the EverVolt home battery, which is capable of supporting both AC and DC coupling for existing and new solar arrays.