Home energy storage systems are usually combined with household photovoltaics, which can increase the proportion of self-generated and self-used photovoltaics, reduce electricity costs and ensure power supply in the event of a power outage. We estimate that the global installed capacity of household storage will reach 10.9GW in 2024, a slight year-on-year increase of 4%. Global demand for household storage is divided, with demand in Europe being relatively weak. This is mainly due to the high penetration rates in traditional developed markets such as Germany and Italy or the impact of subsidy reductions. However, the Ukrainian market is driven by the demand to restore power supply after the war, and its growth rate is impressive. Emerging markets for household storage are performing outstandingly, with South Asia and Southeast Asia experiencing rapid growth. Residents in emerging markets face challenges such as weak power grid infrastructure, frequent power outages, and high electricity prices. They demand a guaranteed power supply and lower electricity costs and are motivated to deploy household storage systems. Users in emerging markets are relatively price-sensitive and pursue cost-effective products. Domestic companies with excellent cost performance and first-mover channel layouts are emerging.
| Home ESS | ||
| Demand side | Market distribution | Europe is the main market for household storage, and its installed capacity will account for 66% of the global total in 2023. The US market and emerging markets in Asia, Africa, and Latin America are also expected to grow. |
| Driving factors | The buyer is a household user, and the main requirements are cost-effectiveness and power security Cost-effectiveness: With high electricity prices and a large difference between the purchase and sale prices, a household storage system can save on electricity costs Power security: Power security in the event of a power outage | |
| Market size | In 2023, 10.4 GW of new capacity will be installed worldwide, of which 6.9 GW will be installed in Europe. In 2024/2025, 10.9/13.4 GW of new capacity is expected to be installed worldwide. | |
| Supply side | Technology route | Mainly lithium batteries are used for energy storage, and lead-acid batteries are used in some emerging markets. Lithium batteries are gradually penetrating the market. |
| Product form | Installed in homes, similar to appliances, often paired with residential photovoltaic systems. Customer-facing products can be energy storage systems + PCS, or all-in-one machines with the two integrated. | |
| Industry chain composition | Battery cells: Upstream, sold to energy storage system manufacturers Energy storage systems, PCS: Usually sold to installers All-in-one units: Usually sold to users through their channels | |
Global demand for household energy storage in 2025
Home storage is an energy storage system for household users. There is demand from users and strong policy support. Home storage systems can help users save electricity costs and ensure power stability. Factors such as high electricity prices and power outages encourage users to purchase Home Battery Backup on their initiative. For the power system, home storage can reduce the impact of household photovoltaics on the power system, improve the flexibility of the power system, and improve users’ ability to withstand risks during peak loads or natural disasters. Various countries support this through subsidy policies.
Demand side: Global demand for household storage is diverging, with emerging markets taking overgrowth. We have summarized and calculated that the global installed capacity of household storage in 2023 will be about 10.4GW, a year-on-year growth of 100%, with Europe as the primary market for household storage installations. In 2024, the installed household storage capacity in Europe declined due to a combination of factors, such as the withdrawal of subsidies and high penetration rates in major markets. At the same time, the installed capacity in the US market and emerging markets in Asia, Africa, and Latin America is expected to grow. We expect growth to reach 13.4 GW in 2025.
European household energy market
European market: EASE predicts that the newly installed capacity in 2024/2025 will be 4.6/4.2GW respectively, and the installed capacity demand will decline. In 2023, the installed capacity of household storage in Europe will grow strongly. EASE (European Energy Storage Association) estimates that the newly installed capacity in 2023 will be 6.9GW, a year-on-year increase of 130%. The main markets for household storage installations in Europe include Germany, Italy, Austria, the Czech Republic and other countries. The penetration rate of household photovoltaic storage in these countries is relatively high, and the market demand is driven by high electricity prices and subsidies. The installed capacity of household storage in Europe will decline for two reasons: First, the installed capacity in the main market has declined. As the main market for household storage in Europe, Germany has a high penetration rate of household photovoltaics and energy storage, and the subsequent household storage installations may decline.
The Netherlands and Germany are the main markets for inverters in Europe, and Germany is the main market for home energy storage. The Netherlands and Germany are the two major markets for inverters in Europe, with imports accounting for 47% and 15% of the European market from January to September. Among them, the Netherlands inverter demand to photovoltaic mostly, Germany is both optical storage demand, is the main market for home battery backup in Europe.
The European market for PV storage systems has yet to recover. From January to September 2024, the value of inverters exported to Europe was 18.4 billion yuan, a year-on-year decrease of 47%. In 2024, European electricity prices fell from the highs of early 2023, coupled with factors such as high interest rates, high penetration rates of PV storage in significant markets, and the withdrawal of subsidies in some markets, which resulted in a weaker overall performance of the European residential PV and energy storage market.
According to the European market outlook of the American microinverter company Enphase, European demand for residential PV and storage may remain under pressure in the fourth quarter. However, there are still some trends in the European market that are worth looking forward to: In the Dutch market, as the NEM expires in early 2027, the PV-storage ratio shows signs of improvement. Although this may suppress demand for residential PV in the short term, it is expected to drive demand for residential storage. Germany and other markets have introduced incentives for balcony PV, which is expected to boost demand for balcony PV and corresponding storage.
German inverter exports to China fall in September - higher average price
In September, China’s exports to Germany inverter amounted to 330 million yuan, the same / ring respectively -47% / -46%. In September, China exported to Germany 131,000 units of inverters (ring – 16%), the average price of a unit of $350 (ring -35%), and the number of and average price has declined.
Price increases mainly drive August export amount of ringgit (August Germany inverter 157,000 units, ringgit -21%, the average price of a single unit $ 540, ringgit +113%); September average price fell, but still higher than in previous months, Germany’s inverter product structure may have changed, such as household storage products accounted for an increase.
German household energy storage installations at a low point
According to the data of the German Federal Network Agency, the new PV installations in Germany in August/September were 906/960MW respectively, down from 1519MW in July, also lower than previous months; the latest energy storage installations in August were 396MWh (of which 337MWh in household storage), and the new energy storage installations in September were 321MWh (of which 306MWh in household storage), lower than July’s 513MWh (of which 449MWh in household storage), also lower than previous months. 449MWh), and also lower than in previous months. As the monthly data from the Federal Network Agency is updated on a rolling basis, the August-September photovoltaic storage installations announced by the agency may be slightly lower than the actual value. At the same time, seasonal factors such as summer vacations may also have a particular impact on installations.
The reasons for August’s export growth may include inventory depletion and changes in product mix, as the demand for residential storage in Ukraine surged in July-August. Some of the backlog of inventory in the German market may have been sold to Ukraine, which led to inventory depletion and increased willingness of distributors/installers to purchase goods. In contrast, the increase in the average price per unit of the exported inverters may imply that there is a change in the product mix.
Ukrainian Household Optical Storage
During the Russian-Ukrainian conflict, Ukraine’s energy infrastructure was damaged, and there was a gap in power supply. Distributed photovoltaic storage is a meaningful way to restore power supply security on the user side, and the demand is skyrocketing. In July/August/September, Ukraine’s inverter imports amounted to $0.53/0.52/0.61 billion, respectively, and the demand remained strong. In September, Ukraine’s inverter imported amounted to $0.61 billion, with the same/QoQ of +300%/ +17%, respectively; the number of imported units was 49,000 units (QoQ +32%), and the average price of a unit was $12,000 (-11%), and the average price of a unit was $12,000 (-11%). The average price per unit is 250/USD (-11% YoY).
Ukraine’s National Renewable Energy Action Plan until 2030 proposes to add 10GW of renewable energy installations in the power sector by 2030, with an estimated investment of $20 billion. Regarding specific policies, the country provides zero-interest loans to residents to purchase household light storage equipment. It introduces a policy of exempting wind and light storage equipment from customs duties and value-added tax to reduce the acquisition cost.
U.S. Home Energy Market
U.S. household energy storage is expected to be in 2024/ 2025. The new household storage installations will be 1.5/1.7GW, respectively, with a 110%/ 15% growth rate. According to Wood Mackenzie, in 2023, the U.S. household storage new installed capacity of 0.7GW/ 1.6GWh, power growth rate of 41%. The U.S. power grid is old; household storage users installed driving factors in addition to saving electricity costs, but also in the blackout to protect the demand for power supply.
U.S. household energy storage installed dispersed, and the installation of states is different, California is the primary market for U.S. household storage installed. 2023 April, California NEM 3.0 policy officially came into effect, making pure household PV system yield drop significantly, while household PV + storage “self-generation and self-consumption” mode of the economy of the relative prominence of the household storage demand growth. SEIA expects that under the influence of high interest rates and California NEM 3.0, the U.S. residential PV installed capacity will decline by 13% in 2024, and the California residential PV installed capacity will decrease by 40% year-on-year; Wood Mackenzie expects that the NEM 3.0 will push the California residential PV distribution and storage rate to 60% in 2024, and push the U.S. average distribution and storage rate to 25% in 2024, up from 14% in 2023; and that the U.S. average distribution and storage rate will increase to 25% in 2024, up from 14% in 2023, up from 25% in 2024. to 25% in 2024. Based on the above analysis, we estimate that the U.S. household storage installation is expected to grow to 1.5GW in 2024, up 110% year-on-year.
| 2023 | 2024 | 2025 | Note | |
| Installed residential PV/ GW | 6.8 | 5.9 | 6.8 | 2023 installation size from SEIA; SEIA expects a 13% decline in household PV installations in ’24 and a return to growth in ’25. |
| Ratio of storage allocation/ % | 14% | 25% | 25% | Woodmac expects the national average allotted storage ratio to increase from 14% in 2023 to 25% in 2024 under the impact of NEM 3.0 in California. |
| Residential Storage Installation /GW | 0.95 | 1.48 | 1.7 | The 2023 SEIA household PV installation multiplied by the allocation and storage ratio calculation yields a 2023 household storage installation of 0.95GW. In contrast, the previous article used Woodmac’s statistics of 0.70GW, with some discrepancy between the two, probably due to differences in caliber. |
Asia-Africa-Latin America Families Out of Energy Emerging Markets
South Asian markets: Pakistan, India
From January to September 2024, the Asian market grew faster year-on-year, with Pakistan and India contributing the largest increment. India is dominated by PV installations, inverter demand is dominated by string type, and there is also household storage demand; Pakistan string type and household storage demand are strong.
January-September, Pakistan inverter import amount of 2.6 billion yuan, an increase of 309%, the export amount jumped to the second Asian market (2023 for the same period for the sixth).
January-September, China’s exports to India inverter amounted to 2.7 billion yuan, an increase of 119%.
Pakistan and India belong to the same South Asian region, abundant light resources, economic and population growth has brought rapid growth in electricity consumption, there is a strong demand for the development of renewable energy. As the price of PV industry chain continues to decline, the installed demand in the emerging markets of India and Pakistan is rapidly rising.
Pakistan and India’s Economic and Energy Overview
| GDP/ US$ billion | Population/ 100 million people | Power installed capacity/ GW | Non-hydro renewable energy installed capacity share/ % | Residential electricity price/(USD/ kWh) | I&C electricity price / (US dollars/ kWh) | |
| Pakistan | 3382 | 2.32 | 43.26 | 6.30% | 0.072 | 0.156 |
| India | 35721 | 14.29 | 417.67 | 30.20% | 0.078 | 0.129 |
Pakistan: Demand for power backup, rising electricity prices drive distributed photovoltaic storage installations
High power tariffs + power cuts push up demand for household storage in Pakistan. User-side high electricity prices + power outages frequently, users have to install household photovoltaic + storage systems to provide electricity demand; a household photovoltaic “net metering” policy is expected to further promote the rate of distribution and storage.
Pakistan’s electricity prices may be under control, but the demand for household photovoltaic storage will still exist. Pakistani authorities are trying to take measures to control electricity prices. Pakistan’s electricity price base is high, a specific rate of decline in household storage still has a reasonable rate of return, coupled with the lack of electricity, power outages in the short term is complex to fundamentally improve the problem, Pakistan will still have a certain amount of household light storage demand.
Pakistan’s basic electricity tariffs have risen sharply year-on-year
| Average basic tariff (Rs/kWh) | Increase (Rs/kWh) | Growth rate (%) | |
| 2021-2022 | 16.91 | ||
| 2022-2023 | 24.82 | 7.91 | 47% |
| 2023-2024 | 29.78 | 4.96 | 20% |
| 2024-2025 | 35.5 | 5.72 | 19% |
| Frequent power outages create demand for power backup | The installed power capacity is dominated by thermal power, but there is a power supply gap due to insufficient reserves of its own fossil energy and dependence on imports; Transmission and distribution facilities are weak, obsolete and aging, and the grid is overloaded during winter, summer and other peak periods of electricity consumption, with power outages becoming the norm. There is a demand for household storage for emergency backup. |
| Rising electricity prices are increasing the incentives for consumers to generate their electricity. | In order to obtain dedicated financial support from the International Monetary Fund (IMF), the Pakistani authorities have increased electricity prices several times over the past three years to increase power sector revenues. Under the pressure of rising electricity prices, there is an incentive for users to purchase optical storage and save on electricity costs. Pakistani authorities are focusing on promoting the decline of electricity prices, electricity prices may get some control. |
| Policy shift from “net metering” (NEM) to “gross metering” | In May 2024, the federal government of Pakistan announced that it would eliminate net metering of solar energy and replace it with “gross metering”, whereby household PV would be sold to the grid at a lower price than the electricity it consumes. This policy change may push up the proportion of household PV distribution and storage. With the decline in the cost of household storage, users for household PV storage power are ushering in an increase. |
India: Large electricity gap and generous policy subsidies drive growth in photovoltaic installations
India’s National Electricity Plan (NEP) 2022-2032 expects a cumulative PV installation of 186GW in 2026-2027. by the end of 2023, India’s cumulative PV installation was 73.3 GW, meaning that India must add more than 110 GW of new PV installations over the next three to four years.
According to JMK research, a local consulting organization in India, in 2023, India’s centralized PV and rooftop household PV installations will reach 6.5GW and 3.0GW respectively, and in the first half of 2024, India’s PV installations will reach 12.2GW, a year-on-year increase of 70%. JMK predicts that in 2024, India’s centralized PV and rooftop residential PV are expected to add 15.9GW and 4.2GW respectively, and that the demand for backup brought about by power outages will have the potential for penetration of residential energy storage.
India’s Household Photovoltaic Incentive Policy
| Projects | DETAILS |
| Central Financial Assistance (CFA) for MNRE | Up to 40% subsidy on rooftop solar for installation of rooftop PV in residential and government/institutional sector. |
| Additional Subsidies to States | States like Maharashtra, Uttar Pradesh, Gujarat, etc. provide additional capital subsidies to solar users. |
| Income Tax Relief | Accelerated depreciation: the first year of the acquisition cost of a residential PV system can be deducted against taxable income with 40% depreciation. |
| Low interest loans | State Bank of India currently offers rooftop solar loans at an interest rate of only 6.5%. |
| Net metering | Residential PV surplus power is fed into the grid and can be used to offset the cost of electricity consumption on a per-volume basis. |
Southeast Asian market: energy gap and power transmission and distribution pressure
The Southeast Asia region includes 11 countries: Myanmar, Thailand, Cambodia, Laos, Vietnam, the Philippines, Malaysia, Singapore, Brunei, Indonesia, and Timor-Leste. Southeast Asia is located in the tropics and has excellent light resources, which has the potential to develop renewable energy.
The main problems faced by the power systems of the countries in the Central and South Peninsula include: insufficient fossil energy reserves, the existence of intermittent hydropower, the mismatch between power generation and use centers, and the weakness of the grid infrastructure, which leads to higher electricity prices for the population and the existence of the demand for the development of household energy storage systems.
The Malay Archipelago region islands are relatively decentralized, the power grid is difficult to lay, the power grid infrastructure is weak, coupled with the existence of typhoons, volcanoes and other natural disasters threat, there is a need for residents to install distributed, off-grid optical storage system to ensure power supply.
Economic and Energy Profiles of Major Optical Storage Markets in Southeast Asia
| GDP/ billion dollars | Population/ billion | Installed power size/ GW | Share of installed renewable energy/ % | Residential tariff/ (US$/kWh) | C&I tariffs/ (US$/kWh) | |
| Thailand | 4953.4 | 0.72 | 53.35 | 13.88% | 0.11 | 0.11 |
| Philippines | 4042.8 | 1.16 | 28.93 | 15.71% | 0.2 | 0.15 |
| Myanmar | 593.6 | 0.54 | 7.29 | 2.48% | 0.02 | 0.05 |
| Vietnam | 4088 | 0.98 | 75.67 | 27.15% | 0.08 | 0.08 |
| Malaysia | 4063.1 | 0.34 | 33.12 | 6.04% | 0.03 | 0.03 |
The demand for household solar storage is growing rapidly in the Philippines, Vietnam and Myanmar
The major markets in Southeast Asia have different national conditions, but there are common characteristics: excellent PV resources, weak power grids, rapid growth in power demand, and developing countries are dominant, so the demand for household storage products is dominated by cost-effective + off-grid products.2024 From January to September, the amount of inverter imports into Southeast Asia totaled US$2.47 billion, an increase of 14% year-on-year.2024 From January to September, the top five markets for inverter exports to Southeast Asia are Thailand, the Philippines, Vietnam, Malaysia, and Myanmar. were Thailand, the Philippines, Vietnam, Malaysia, and Myanmar, of which the inverter demand in the Philippines, Vietnam, and Myanmar included household PV and household energy storage, the inverter demand in Thailand was dominated by PV (industrial/commercial/centralized), and the inverter demand in Malaysia was dominated by household PV. The Philippines, Vietnam and Myanmar lead the growth of Southeast Asia’s household storage market.
Industry Chain: Split Unit / All-in-One Model
Household storage systems are mainly composed of energy storage batteries and inverters, and the end product can be a separate energy storage battery system + inverter or an integration of the two. The storage battery and inverter are the two main components of a household storage system; the storage battery is used to store electrical energy, while the inverter is used to convert electrical energy for use by the load or grid connection. Regarding product provision, household energy storage terminal products can be divided into integrated and split machines.
All-in-one energy storage battery: The battery and inverter are integrated into a single device, usually sold and installed by the all-in-one machine brand, and the product positioning is relatively high-end.
Powerwall battery: the end product is a separate energy storage battery system, an inverter product. The energy storage battery system includes a battery pack, BMS, and other parts without an inverter, usually sold to the installer; the installer selects the appropriate inverter for the customer to install. The purchase cost is relatively lower than an all-in-one system, and the installation and expansion are flexible.
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Household storage batteries and systems: including battery cells, battery systems, and integrated devices
At present, there are three main ways for international mainstream lithium battery companies to participate in the household storage track:
- Providing battery cells to integrators.
- Providing battery systems (batteries + BMS + cooling systems, etc.) to installers.
- Providing energy storage devices that integrate batteries and inverters directly to end customers.
- The latter two models provide end products for consumers.
Household storage batteries: China's powerful enterprises
Energy storage battery industry chain participants to power battery enterprises, the relevant enterprises have many years of technology and production process accumulation, competitive strength, energy storage battery competition pattern shows similar to the power battery “one over many strong” pattern, Ningde era share leading.
According to Infolink, in the first half of 2024, the global energy storage battery market CR5 amounted to 73.2%, CR10 amounted to 91.0%, and in the first half of 2024, the total shipments of global energy storage battery cells Top 5 enterprises are Ningde Times, YWL, Ruipu Lanjun, Haichen Energy Storage and BYD.
Household storage systems: Europe and emerging markets
Advantageous brands in different national markets are different, usually local enterprises, such as the United States Enphase, Tesla, and Germany Sonnen; also includes in a particular country or a few countries for a long time deep cultivation, the establishment of brand reputation and service system of the domestic brand, such as Pai Energy Technology, BYD, DEYE shares.
At present, household storage track enterprises are mainly in the European market and Southeast Asia, South Africa, and other emerging markets; the U.S. market is more in the form of OEM OEM to enter. Product power, channel layout, and serviceability constitute the core competitiveness of household storage enterprises, the leading enterprises after years of accumulation, and their respective market advantages have a particular reputation.
2024 global household storage growth slowed, but different market demands showed differentiation; emerging market growth is better than the European market. The layout is more focused on emerging markets, and market share in emerging markets leading enterprises is still expected to achieve bright performance.
Household storage inverter: divided into energy storage inverter and photovoltaic storage hybrid inverter
Energy storage inverters are devices for AC and DC conversion between the energy storage system, the grid, and the load, and there are two major types: single storage inverters (PCS) and hybrid inverters (Hybrid) for light and storage. A single storage inverter is used for the AC coupling system, and a hybrid inverter is used for the DC coupling system. Domestic manufacturers of household storage inverter products mainly use single storage inverters and layouts, promoting high-power hybrid inverter products.
Energy storage inverters are mainly sold as terminal products with brand premium. In the terminal split installation scenario, the energy storage inverter (single storage or light storage hybrid) is a product for end customers, with brand premium and customer recognition. Compared with the battery system + inverter all-in-one program, the single storage inverter program is usually more economical, and users can choose their battery pack products according to their wishes; for example, some users in Europe will choose the Chinese household storage inverter + local battery product combination installation, while price-sensitive emerging market users will be selected according to the demand for lead-acid batteries + Chinese household storage inverter products.
Conclude
Household energy storage systems are usually coupled with household PV, which can not only improve the proportion of PV self-generated self-consumption and reduce the cost of electricity but also protect the power supply in the case of grid failure. Global household storage demand differentiation: European demand is weaker, mainly due to Germany, Italy, and other traditionally developed market penetration rates high or subsidy slopes, but the Ukrainian market, by the post-war restoration of power supply demand driven by the growth rate of eye-catching. Household storage’s emerging market performance is outstanding; South and Southeast Asia markets have ushered in faster growth. Emerging market residents face weak grid facilities, frequent power outages, high electricity prices, and other problems; to protect the power supply and reduce the cost of electricity demand, the deployment of household storage system motivation is needed. Users in emerging markets are relatively price-sensitive and pursue cost-effective products, and domestic enterprises with excellent price-performance ratios and pre-emptive channel layouts are emerging.
