The US energy storage market reached a significant milestone in Q2 2024, setting a new quarterly record. Grid-scale installations led the surge, with 2,773 MW and 9,982 MWh deployed, making up the bulk of more than 3,000 MW of storage installations across all segments. This marks a 74% increase compared to Q2 2023. 1o433g

This achievement represents the second-highest quarter on record for total installations, trailing only Q4 2023's remarkable 13,437 MWh. According to the latest US Energy Storage Monitor report, released by the American Clean Power Association (A) and Wood Mackenzie, every segment of the market saw year-over-year growth in Q2. Community storage (CCI) rose by 61% to 87 MWh, while the residential segment expanded by 12% to 423 MWh. 

Source: Wood Mackenzie

California, Arizona, and Texas ed for 85% of the total installations.

"Energy storage is now a key component of the power grid, enhancing resilience and affordability," said John Hensley, Senior VP of Markets and Policy Analysis for A. "New storage capacity is providing effective solutions for the growing energy demand, capacity shortfalls, and the rising occurrence of extreme weather events."

Vanessa Witte, senior analyst at Wood Mackenzie, noted that the grid-scale segment remains the primary driver of growth. "Community storage performed strongly, but the residential segment saw a slower quarter due to reduced growth in California, Hawaii, and Puerto Rico, partly due to changes in incentives."

Looking ahead, Wood Mackenzie's five-year outlook predicts sustained growth, with US storage deployments expected to rise by 42% between 2023 and 2024. However, the pace of growth is expected to level out, with a 7.6% annual average increase between 2025 and 2028. By 2024, the industry is forecasted to deploy 12.8 GW/36.9 GWh, with grid-scale storage projected to grow 32% year-over-year.

In total, the US is expected to install 62 GW of grid-scale storage and 12 GW of distributed storage between 2024 and 2028. The residential sector is anticipated to dominate distributed installations, ing for 80% of the 10 GW expected by 2028.

Souce: Wood Mackenzie

Despite this promising outlook, the industry faces challenges. "Growth will flatten in 2025 and 2026 due to early-stage project delays and interconnection hurdles," Witte said. The CCI segment continues to experience barriers, including project complexity and limited financial opportunities.

US energy storage market outlook through 2028 6qn3w

A cumulative growth chart shows that energy storage, particularly in grid-scale and residential sectors, will continue to expand rapidly but faces logistical and financial challenges that could impact growth rates from 2025 onward.