The market for industrial battery is expected to grow at a CAGR of 8.36% during the forecast period of 2019
NEW YORK, Sept. 11, 2019 /PRNewswire/ --
Market Overview
The market for industrial battery is expected to grow at a CAGR of 8.36% during the forecast period of 2019 – 2024. Declining lithium-ion battery prices, increasing demand from data centers and telecom sector, and rising renewable energy integration across the globe are some of the key factors driving the market. However, factors such as uncertainty in raw material prices and availability of raw materials, such as cobalt, lead, and lithium, are likely to curtail the market growth rate during the forecast period.
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- Among the different types of industrial battery technologies, lithium-ion battery (LIB) is expected to witness significant growth in the global industrial battery market, over the forecast period, majorly due to its favorable capacity-to-weight ratio. Other factors boosting the LIB adoption include their properties like better performance, higher energy density, and decreasing price.
- The rising focus on technologically advanced batteries by end-users and manufacturers is likely to create a massive opportunity for the battery companies to invest and redirect their resources to make a breakthrough battery technology.
- Asia-Pacific dominated the industrial battery market across the globe in 2018, owing to its rising demand for UPS, forklifts, and grid level energy storage system applications.
Key Market Trends
Lithium-Ion Battery (LIB) Technology to Witness a Significant Growth Rate
- Lithium-ion battery (LIB) is expected to witness significant growth in the global industrial battery market, over the forecast period, majorly due to its favorable capacity-to-weight ratio. Other factors boosting the LIB adoption include their properties like better performance, higher energy density, and decreasing price.
- The price of LIB is usually higher compared to other batteries. However, leading players in the market have been investing in R&D activities to improve LIB's performance and price, in order to gain economies of scale. The emergence of new and exciting markets, such as energy storage systems (ESS), for both commercial and residential applications, is driving the demand for LIB.
- Lithium-ion batteries are witnessing a massive demand in the battery energy storage market, owing to their declining prices. The US Department of Energy (DOE) announced an interim price target of USD 125/kWh by 2020, and the prices for lithium-ion batteries is estimated to fall to as low as USD 73/kWh by 2030.
- Additionally, lithium-ion batteries are expected to hold the most significant share in the battery energy storage market in the coming years, as they require little maintenance, are light-weight, and have a reliable cycle life, high energy density regarding volume, and high charge/discharge efficiency.
- Globally, forklifts orders doubled from 2009 till 2018. The United States witnessed an increase of nearly 150% during 2009-2018. The increase was partly due to the need for upgrading and replacing aging capital equipment. Adding to this, the increasing demand for the fast delivery of products also has pushed for improvements in logistics and distribution, in both developed and emerging regions, such as North America, Europe, and Asia-Pacific. This, in turn, is likely to boost the demand for industrial Li-ion batteries in the material handling industry in the coming years.
Asia-Pacific to Dominate the Market
- Asia-Pacific accounted for the major share of the industrial battery in 2018 and is expected to continue its dominance over the forecast period. The market for industrial batteries in Asia-Pacific is majorly driven by China, India, Japan, and South Korea.
- In 2018, China's total energy storage project capacity reached 1018.5 MW, 216% increases compared to the capacity in 2017. The newly added grid-side energy storage capacity in China reached 206.8 MW, accounting for around 36% of the new installed capacity in 2018 in the country. The grid-side energy storage sector was the biggest consumer of energy storage installation in 2018, by capacity.
- Factors such as significant growth in renewable power generation capacity, energy storage targets released by electric utilities in 2018 coupled with the declining battery cost have driven the large-scale energy storage capacity additions in the country.
- Hence, the growth witnessed in energy storage deployment in 2018 is expected to continue in the coming years as well, which, in turn, is expected to be one of the biggest drivers for the industrial battery market in the country, during the forecast period.
- On the other hand, the Indian retail market is growing at a rapid rate with urbanization and increasing per capita purchasing parity in the country. Major foreign retail chains are entering the country, and domestic retail chains have also expanded their operations owing to the rising demand.
- In order to maintain efficient and fast logistics operations, the demand for material handling equipment, like forklifts to maintain operations in warehouses, is rising in the country. This, in turn, is expected to propel the demand for industrial batteries in the country during the forecast period.
- Similarly, countries such as Japan and South Korea are facing an increasing demand for material handling equipment since the past few years.
- Therefore, factors such as increasing energy storage deployments, increasing demand from material handling industry, and upcoming data centers are expected to boost the industrial battery market in the region during the forecast period.
Competitive Landscape
The global industrial battery market is consolidated is fragmented. The key players in this market include EnerSys, Exide Industries Limited, GS Yuasa Corporation, and East Penn Manufacturing Company, Inc.
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