Navigant Research predicts that most grid-connected energy storage will be third-party financed by 2025

Written By: Stratton Report
November 7, 2016

On November 7, Navigant Research announced its estimate that by 2025, 84 percent of projects in grid-tied stationary battery energy storage market are expected to be financed by third parties or utilities examines.

According to the research firm, the more financially predictable benefits that grid-tied stationary applications battery energy storage systems are now delivering customer and grid value in a more financially predictable way are creating new energy storage financing asset classes.

William Tokash, senior research analyst with Navigant Research remarked:

“Just as the advent of the solar power purchase agreement was a key driver for the adoption of solar photovoltaics (PV), financing innovation will be a key driver for the adoption of stationary battery energy storage technology. Now that BESSs are delivering grid benefits in ways that can be better defined financially, new financing asset classes are emerging to support new projects.”

Per Navigant, energy project finance investors are moving into the grid-tied stationary battery energy storage sector as the unique risks associated with the operation of BESSs and potential revenue and operating costs are bing understood and quantified.

Navigant stressed that it came to this conclusion after examining the market drivers and challenges, key risks, and technology requirements related to battery energy storage project financing in behind-the-meter host-controlled projects, BTM utility-controlled projects, and front-of-the-meter utility-scale projects.