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Good Times Ahead for US Energy Storage Market: Stocks in Focus

Aparajita Dutta

With rapid adoption of clean energy across the United States, energy storage market prospects appear impressive. Notably, as the cost of energy storage declined steadily, there has been an increase in pairing of renewable energy generators with energy storage, particularly batteries.

Per the latest date released by the U.S. Energy Information Administration (EIA), the number of solar and wind generation sites co-located with batteries have grown from 19 paired sites in 2016 to 53 paired sites in 2019.

Benefits of Energy Storage & Pairing

Storage technologies strengthen and stabilize the U.S. grid by providing backup power, leveling loads and offering a range of other energy management services.  One of the most important benefits of combining energy storage with renewable technologies is the ability to store energy after it is generated and distributing it when needed rather than right after it is produced.  This reduces the need to curtail renewable generation and allow energy to be deployed during periods of high electricity demand.

While the most common application for batteries co-located with renewable sources is storing excess energy, these batteries are also used for frequency regulation, which helps to maintain the grid’s electric frequency on a second-to-second basis. Batteries can also provide transmission and distribution support, helping to smooth out energy flows.

Looking Ahead

EIA projects average renewable capacity at proposed U.S. facilities to more than double from 34 megawatts (MW) to 75 MW by the end of 2023. Average battery capacity will grow from 5 MW to 36 MW.

Notably, the trend of pairing renewable energy with storage is expected to continue. According to planned installations reported to EIA, another 56 facilities pairing renewable energy and battery storage will come online by the end of 2023.

Stocks in Focus

It is evident that stocks involved in energy storage boast solid growth prospects and thus investors should keep a tab on them. We have mentioned below a few such companies.

NextEra Energy NEE: This utility provider has more energy storage capacity than any other company in the United States, with more than 140 MW of battery energy storage systems in operation. It continues to lead the industry with storage innovations such as the Babcock Ranch Solar Energy Center – the largest combined solar-plus-storage facility in the country. The company’s largest battery energy storage facility in operation today is the 30-MW Blue Summit Battery Energy Storage System in Texas.

Enphase Energy ENPH: This solar microinverter manufacturer’s next-generation battery —Enphase Encharge 3 or Encharge 10 storage systems —has usable and scalable capacity of 3.4 kWh and 10.1 kWh, respectively. In March 2020, the company announced that it has already shipped more than 36 MWh of energy storage, since introducing Enphase energy storage products in late 2016. More than 18,000 Enphase energy storage systems have been commissioned worldwide, of which 31% are paired with non-Enphase solar systems, reflecting the flexibility of the Enphase AC-coupled architecture.  

General Electric GE: This conglomerate’s renewable energy division offers customized storage products that include advanced lead-acid batteries as well as Energy Management Systems (EMS) to integrate the battery management system (BMS) into a fully functional storage digital controller. The company currently has more than 207 MWh of energy storage in operation or in construction globally.

Fluence – a joint venture between AES Corp. AES and Siemens AG SIEGY, is a global leader in the market for utility-scale energy storage technology and services. Its energy storage technology systems include Advancion, Siestorage and SunFlex, which are designed for the most demanding industrial applications.

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

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The AES Corporation (AES) : Free Stock Analysis Report
General Electric Company (GE) : Free Stock Analysis Report
NextEra Energy, Inc. (NEE) : Free Stock Analysis Report
Enphase Energy, Inc. (ENPH) : Free Stock Analysis Report
Siemens AG (SIEGY) : Free Stock Analysis Report
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