Global battery energy storage (BESS) investment reached $65.6 billion in 2024, driven by falling battery pack prices and surging demand for reliable, flexible clean energy solutions. As battery energy storage becomes the backbone of grid flexibility and clean energy integration, businesses must act now to secure their place in a market forecasted to exceed $270 billion.
Strategic Imperatives Shaping BESS Growth
- Differentiating with Value-Added Services and Scalable Models: In a rapidly maturing market, success isn’t just about installing batteries. Companies must deliver value-added services like Virtual Power Plants (VPPs), strengthen installer networks, and scale operations efficiently. These moves are essential for capturing market share, improving customer stickiness, and delivering long-term growth.
- Capitalizing on the Rise of Solar-Plus-Storage and Retrofits: With electricity prices rising and supportive policy incentives, businesses must integrate solar-plus-storage solutions, expand retrofit capabilities, and unlock new revenue streams. This strategic pivot not only drives operational efficiency but also positions companies to lead in high-opportunity markets.
- Expanding Globally, Acting Locally: As BESS adoption spreads from early-adopter regions to emerging markets across Asia, Europe, and the Americas, businesses need to scale globally while leveraging local market knowledge and partnerships. Understanding regional regulations, building on-the-ground networks, and aligning with local customer needs are critical for sustainable success.
Innovation Frontiers Driving Competitive Edge
- Energy AI and Digital Optimization: Innovators are embracing AI and digital technologies to optimize storage performance, forecast demand, and enhance asset ROI. These advancements enable companies to offer smarter, more adaptive energy solutions.
- C&I BESS Integration and Quick Wins: Commercial and Industrial (C&I) BESS projects are already delivering quick wins by cutting costs, boosting uptime, and enhancing energy resilience. Companies that act now can capture immediate value while preparing for long-term growth.
- Revenue-Ready Models Like VPPs and Demand Response: Monetizing flexibility through merchant models, demand response, and VPP participation offers additional revenue streams, making energy storage not just a cost center but a profit driver.
Companies to Action
- Huawei leads in residential energy storage by delivering scalable, efficient solutions that integrate smart management and AI-driven optimization, enabling homeowners to maximize solar self-consumption and enhance grid resilience.
- Pylontech has rapidly expanded from residential storage into commercial, industrial, and grid-scale projects, innovating with modular battery systems and advanced safety features to meet diverse energy storage demands globally.
- Sonnen stands out in Europe’s energy storage market by combining residential batteries with virtual power plant (VPP) technology, empowering customers to optimize energy use and participate in grid flexibility programs.
This blog is based on the recent analysis, Top 10 Growth Opportunities for Energy Storage, 2025, conducted by Frost & Sullivan’s global Energy team.
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