According to Marianne Boust, Principal Analyst, IHS Technology, owing to massive cost reductions, Li-ion technology is now leading lead-acid batteries in the power storage category. Li-ion is even challenging sodium sulfur and flow for long-duration storage.
IHS estimates that 90 percent of the utility-side of meter energy storage projects tracked are based on Li-ion battery technology. Underpinning the rapid cost reduction is the build-up of the supply chain for batteries in the auto and power sectors. Competition between China's BYD, GCL, South Korea's Samsung SDI, LG Chem and Japan's Panasonic is intensifying. In the residential space GCL has launched a battery system at $450/kWh (excluding inverter) in Australia, nearly matching Tesla's announced price of $3,000 for a 7kWh system.
Li-ion is also gaining traction in the grid-scale market for longer duration, which has been historically dominated by sodium sulfur and flow batteries. IHS has observed grid-scale batteries prices for delivery in 2016 around $400/kWh to $500/kWh, including warranty and management system, with a further 30 percent reduction in the next 18 months. Nonetheless, flow battery manufacturers are scaling up their ambitions and betting on superior lifetime of flow battery technology, as evidenced by the announcement of the 200 MW/800 MWh Dalian demonstration project in China, led by Rongke Power and UniEnergy Technologies.
Although lead-acid technology continues to be used in emerging markets where lack of financing is the biggest barrier, we're seeing lead-acid market share shrinking in developed countries, owing to the superior performance of Li-ion in terms of response time and longer life.