Battery Energy Storage Market Size, Share, Growth, Trends, and Global Industry Analysis: By Battery Type (Lithium-ion Batteries, Lead-acid Batteries, Flow Batteries, Sodium-sulfur Batteries, Nickel-based Batteries, Others), By Application (Residential, Commercial & Industrial (C&I), Utility-scale), By Energy Capacity (Below 500 kWh, 500 kWh – 1 MWh, 1 MWh – 5 MWh, Above 5 MWh), By End user (Power Utilities, Renewable Developers, Industrial Enterprises, Residential Consumers) and Region Forecast 2020-2031

Battery Energy Storage Market size was valued at US$ 9,735.4 million in 2024 and is expected to reach US$ 21,254.3 million by 2031, growing at a significant CAGR of 11.8% from 2025-2031. The market is the business engaged in the design, manufacturing, deployment, and management of rechargeable batteries meant to store energy for future use. These systems are mainly applied to balance electricity supply and demand, improve grid stability, and facilitate renewable energy integration by storing excess energy from sources such as solar and wind. Battery energy storage solutions can vary from small residential to utility-scale and are typically based on technologies like lithium-ion, lead-acid, flow batteries, and new chemistries. This industry has a pivotal role in supporting energy transition, decarbonization, and energy independence in power, industrial, commercial, and residential markets.

The market is growing fast, propelled by the world's transition towards cleaner energy sources, the emergence of decentralized power systems, and escalating investments in grid modernization. As renewable energy projects are increasingly being deployed across the globe, battery storage has become imperative for addressing intermittency and guaranteeing energy reliability. Governments and the private sector are making huge investments in energy storage to strengthen the grid's resilience and enable peak demand management. Improvements in technology, particularly in the case of lithium-ion batteries, have greatly increased storage capacity, efficiency, and longevity, supporting widespread use. In addition, declining battery prices and favourable regulation policies are predicted to drive market growth in both developed and developing economies.

Facts & Figures

• In fact, Global Storage Capacity: As of 2024, over 7.5 GW of battery energy storage capacity was deployed worldwide, marking a significant growth in energy storage systems used for grid stabilization and renewable energy integration.
• Lithium-Ion Battery Dominance: Lithium-ion batteries account for more than 90% of the global energy storage market share due to their high energy density, efficiency, and cost-effectiveness.

Key Developments:

• In March 2025, BSES, a power company, announced the nearing completion of India’s first commercially approved standalone battery energy storage system (BESS) at Kilokri in South Delhi. The system, designed to provide four hours of daily power, involves the installation of 12 liquid-cooled batteries, with nine already in place and the remaining batteries expected to be installed soon.
• In March 2025, during Patrick Pouyanné's participation in the Europe 2025 conference in Berlin, TotalEnergies unveiled investment decisions for six battery storage projects. These projects, integral to the company's growth in the electricity sector, will add 221 MW of new storage capacity and require an investment of €160 million.
• In March 2025, Atlas Copco launched the ZBC 1000-1200, the largest energy storage system (ESS) available on the market, providing 1 MW of power from a single unit. Built with advanced battery technology, the ZBC 1 MW delivers reliable power, enabling users to reduce emissions by up to 90% and save on costs. It is particularly suited for demanding rental applications, including mining.
• In April 2025, BYD Energy Storage, a division of Chinese conglomerate BYD, introduced its latest C&I energy storage system, Chess Plus, featuring 320 Ah lithium iron phosphate (LFP) thick blade cells. The system is currently available in China and the US, with the European version undergoing evaluation.

Battery Energy Storage Market Segmentation:

Based on the battery type:

• Lithium-ion Batteries
• Lead-acid Batteries
• Flow Batteries
• Sodium-sulfur Batteries
• Nickel-based Batteries
• Others

Based on battery types, lithium-ion batteries are expected to dominate the market owing to their higher performance, energy density, and declining prices. Lithium-ion technology has high efficiency, long lifespan, and the ability to be charged quickly, making it suitable for both grid-level and distributed energy storage systems. The extensive use of electric vehicles has also fuelled large-scale production, thus lowered unit prices and made supply chains stronger across the world. Further, technological developments and higher investments in recycling and second-life use are broadening the application and sustainability of lithium-ion batteries. Such benefits solidly establish lithium-ion as the industry's leading segment.

Based on the application:

• Residential
• Commercial & Industrial (C&I)
• Utility-scale

Among the application segments, the utility scale market is predicted to dominate the battery energy storage industry due to increasing demand for grid stability and renewable energy feeding into the network. As the world speeds up in adopting clean sources of power such as wind and solar energy, utility-scale battery systems ensure a balance of supply and demand, holding oversupply, and guaranteeing the supply of continuous power. Mass deployments like Tesla's Megapack deployments or country-level storage tenders in China, the U.S., and Australia accentuate this trend.

Moreover, governments and energy regulators' favourable regulatory policies and economic incentives are persuading utility companies to heavily invest in high-capacity storage systems. These factors further reinforce the supremacy of the utility-scale segment in defining the future energy paradigm.

Based on the energy capacity:

• Below 500 kWh
• 500 kWh – 1 MWh
• 1 MWh – 5 MWh
• Above 5 MWh

Within the energy capacity segmentation, the 1 MWh – 5 MWh segment will dominate the market. The range provides a perfect balance of scalability, cost-effectiveness, and operational versatility, which makes it extremely ideal for a vast range of applications—particularly in the commercial & industrial (C&I) and utility-scale markets. Battery systems of this capacity range are widely used for peak shaving, load shifting, and backup power applications, especially in solar and wind power integration schemes. Moreover, the evolution of modular battery system architectures has facilitated deployment within this capacity range, which is more affordable and easier to maintain.

The growing need for decentralized microgrid and energy storage solutions also confirms the leadership of this segment, as it provides strong performance without the infrastructure or space requirements of larger systems. As renewable energy penetration increases around the world, the 1 MWh – 5 MWh segment is perfectly placed to address both reliability and sustainability needs.

Based on the end user:

• Power Utilities
• Renewable Developers
• Industrial Enterprises
• Residential Consumers

Among the various end users, power utilities will have the greatest market share in the market. This is based on their integral role in grid reliability, peak demand management, and connecting large-scale renewable resources like solar and wind. With the transition of the global energy mix towards cleaner forms, utilities are increasingly investing in next-generation energy storage systems to balance intermittent generation and offer ancillary services such as frequency regulation. Grid-scale battery projects in California, South Korea, and Germany are prime examples of how battery storage is being adopted by utilities to complement decarbonization objectives.

In addition, supportive policies, capacity expansion strategies, and regulatory incentives are compelling utility companies to incorporate energy storage into their networks. The capability of utilities to install large-capacity systems and enjoy economies of scale enhances their leadership role in this emerging market.