Australia Energy Storage Market

Australia Energy Storage Market Size and Share:

The Australia energy storage market size was valued at 4.0 GW in 2024. Looking forward, IMARC Group estimates the market to reach 17.8 GW by 2033, exhibiting a CAGR of 18.0% from 2025-2033. The market is majorly driven by the rising integration of renewable energy sources such as solar and wind into the national grid, increasing investments in grid-scale battery projects, growing adoption of residential and commercial storage systems, government subsidies for clean energy transitions, advancements in battery technologies, and demand for efficient energy management.

The Australian market is majorly driven by the increasing demand for incorporating renewable sources such as solar and wind power into the national grid, leading to propelling demand for better storage facilities. This escalating trend of accelerating investments in grid-scale battery projects has further promoted the design of efficient storage systems for supply and demand balancing. Additionally, increasing demand for residential and commercial energy storage systems has allowed consumers to maximize their use of energy and ensure the grid remains stable. Furthermore, government incentives to shift to clean energy transitions with subsidy and regulatory support have substantially broadened the scope of application in energy storage. For instance, on 4^th December 2024, GreenTech Hub of Curtin University in Western Australia declared the innovation challenge for the advanced energy storage system. Funded by both the state government and Gorgon Joint Venture by Chevron, it looks towards making the solution more efficient in relation to both reliability and area-wide accessibility and supply from urban and rural locations alike. The challenge lines up with the commitment of Western Australia in attaining net-zero carbon emissions by 2050, where emphasis is placed on developing scalable, long-duration energy storage technologies to support integration into the grid.

The market is also driven by the increasing demand to support charging infrastructure. In addition, innovations in batteries, such as lithium-ion and solid-state batteries, are improving efficiency and lowering cost, which could enable ubiquitous deployment. Also, decentralization of the energy system also increases the installation of microgrids with built-in storage capacity, to ensure a reliable power supply in remote areas, thereby supporting the market further. Apart from this, growing demand for sustainability and carbon emissions mitigation is driving industries to switch to energy storage to improve efficient energy management, making Australia a key player in the global energy storage market. As per a report published by Department of Climate Change, Energy, the Environment and Water, the Australian government has committed to achieving net-zero emissions by 2050 under its Nationally Determined Contributions to the Paris Agreement. The strategy focuses on accelerating renewable energy adoption, enhancing energy efficiency, and supporting innovative technologies like carbon capture and storage. This initiative underlines Australia's commitment to reducing greenhouse gas emissions while fostering economic growth and resilience.

Australia Energy Storage Market Trends:

Emerging Integration of Long-Duration Storage Technologies

The Australian energy storage market is rapidly growing in long-duration storage solutions to complement intermittent renewable energy sources. Moreover, pumped hydro and advanced flow batteries have emerged as the core technologies that can help stabilize the grid and diminish reliance on fossil fuels, as they ensure continuous energy availability during extended periods of low solar or wind output. Also, continued investments by the government and the private sector in pilot long-duration systems are seen as supporting Australia's renewable energy mission. For instance, on October 4, 2024, the U.S. Department of Energy announced that Australia had been named an international collaborator in its Long Duration Storage Shot program, aiming to cut costs for grid-scale energy storage by 90% for systems delivering over 10 hours within the next decade. The partnership will engage with different technologies, which include electrochemical, mechanical, thermal, and chemical carriers, to increase grid flexibility. In addition, the U.S. National Renewable Energy Laboratory and Australia's Commonwealth Scientific and Industrial Research Organisation will deepen their collaboration to support the energy transition. This trend helps the country respond to its rising demand for robust and reliable energy storage and facilitate the modernization of the grid.

Residential Battery Storage Solutions Grow Rapidly

The market is driven by the growth in residential battery take-up due to cost degression and increased installation of solar panels. Home energy storage systems are allowing households to make the most of solar energy usage, reduce electricity bills, and achieve energy independence. For instance, on December 6, 2024, the Clean Energy Finance Corporation (CEFC) agreed to commit USD 50 million to Bank Australia, targeting energy performance upgrades for existing homes, under the Household Energy Upgrades Fund (HEUF), aiming to unlock up to USD 100 million in green lending by providing a discounted variable rate of 5.38% for the first five years. The project is an endorsement of Australia's commitment to improving domestic energy efficiency and becoming net-zero on emissions. Hybrid inverters and smart energy management systems are further improving consumer interest. Residential storage systems are becoming an attractive option in regions with high electricity costs and grid reliability concerns. This trend is further aided by government rebates and subsidies, which make energy storage more accessible to the general population.

Increasing Share of Energy-as-a-Service (EaaS) Models

Energy-as-a-Service models are revolutionizing the face of energy storage in Australia by allowing businesses and households to access storage solutions with no or minimal upfront investments. For instance, on May 9, 2024, Energy Vault Holdings, Inc. and ACEN Australia announced agreements for two battery energy storage system deployments totalling 400 MWh in Australia. The projects comprise a 150 MW/300 MWh BESS and a 50 MW/100 MWh BESS integrated into ACEN Australia's 720 MW New England Solar facility, one of the largest solar projects in Australia's National Electricity Market. These models include leasing and subscription services that cover installation, maintenance, and upgrade. With growing demand for consuming more energy, and requiring clean energy solutions, providers of EaaS are going to present more customized storage plans, a trend in which interest from commercial and industrial buyers who are attracted by both flexible and cost-effective means of attaining their sustainability objectives.

Australia Energy Storage Industry Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the Australia energy storage market, along with forecasts at the country and regional levels from 2025-2033. The market has been categorized based on type and end user.

Analysis by Type:

• Battery Energy Storage System (BESS)
• Pumped-storage Hydroelectricity (PSH)
• Others
   

Battery energy storage systems is crucial for Australia's energy storage market as flexibility and quick response rate increase grid stability and ensure energy availability during peak demand. Furthermore, BESS technology is supporting residential and commercial applications, enabling users to optimize energy use and reduce reliance on the national grid. Additionally, government incentives and large-scale projects are propelling the adoption of BESS, making it a cornerstone of Australia's clean energy transition.

Pumped-storage hydroelectricity (PSH) plays a vital role in the market as it provides large-scale balancing of electricity supply and demand in the country. With the ability to hold significant amounts of energy by pumping water between reservoirs, PSH will help ensure grid reliability at times when renewable energy penetrations are increasing. Additionally, PSH projects are being paired with intermittent renewable sources in a way that provides long-duration storage essential for maintaining energy security. Moreover, current investments to upgrade PSH infrastructure reaffirm its role in Australia's long-term sustainability objectives, solidifying its position as a sure bet for energy storage.

Analysis by End User:

• Residential
• Commercial and Industrial
• Utility Scale
   

The residential sector is playing a crucial role in the market in association with increasing rooftop solar and the need for efficient management of energy. Homeowners incorporate the battery storage solution to utilize maximum self-consumption through energy that is produced from solar. Also, they ensure reliable power backup during outages. This segment is further being helped by government subsidies and incentives for renewable energy adoption so that energy storage systems would be more accessible to users with the residential category.

The commercial and industrial sector is significantly contributing to the Australian energy storage market, as businesses seek solutions to manage peak demand charges and ensure operational continuity. Industries are adopting battery systems to stabilize energy costs and improve power reliability. Moreover, the growing awareness of corporate sustainability goals is prompting investments in energy storage, as it enables the efficient integration of renewable energy into commercial operations.

Utility-scale is taking the lead in the energy storage market in Australia, propelled by large-scale investments in the grid-scale battery system as utility providers want to deploy energy storage to support grid stability, supply and demand balancing, and incorporation of intermittent renewable energy like solar and wind. Governments are also investing in several projects to transform the power grid into a cleaner and more resilient entity.

Regional Analysis:

• Australia Capital Territory & New South Wales
• Victoria & Tasmania
• Queensland
• Northern Territory & Southern Australia
• Western Australia
   

Australia Capital Territory and New South Wales play a pivotal role in the energy storage market due to the dense population. Additionally, important investments are being made to ensure the stability and reliability of grids through large-scale battery storage projects. Integration of solar and wind energy into the grid and government incentives for the regions are speeding up the pace of adopting advanced storage systems in this region.

Victoria and Tasmania are significant contributors to the energy storage market as they have clean energy transitions and grid modernization in mind. In Victoria, the biggest battery energy storage projects will ensure steady power during peak demand. For Tasmania, it relies heavily on hydroelectric power while developing emerging battery storage solutions for a balanced and sustainable energy ecosystem.

Queensland’s energy storage market is increasing significantly as it has an abundance of solar resources and is gaining high investment in renewable energy projects. It is focusing on residential and commercial storage systems, where consumers can make the maximum utilization of solar energy. The state government initiatives supporting clean energy technologies are enhancing the grid efficiency and demanding innovative energy storage solutions.

The Northern Territory and South Australia are the key markets for energy storage, mainly in terms of off-grid energy supply. South Australia, which is the leading country in integrating renewable energy into its power supply system, utilizes battery storage to stabilize its intermittent supply from wind and solar farms. In the Northern Territory, hybrid renewable energy systems are being promoted as an alternative to reliance on diesel generators, therefore giving emphasis to energy independence and sustainability in off-grid areas.

Western Australia is becoming one of the key players in the energy storage market due to its distant mining operations and vast renewable energy resources. The state focuses on grid-scale and standalone storage systems to ensure reliable supply of energy in isolated areas. Furthermore, significant investments in new innovative battery projects by both the private and public sectors are making Western Australia a center for energy storage innovation.

Competitive Landscape:

The competitive landscape of the Australia energy storage market is characterized by continual innovation and rapid adoption of advanced storage technologies. Companies are focusing on developing efficient, scalable, and sustainable energy storage solutions to meet the increasing demand for renewable energy integration. Moreover, collaborations between technology providers and utility companies are fostering market growth by enhancing grid stability and efficiency. Additionally, the emphasis on reducing costs through technological advancements and government incentives is driving intense competition. Besides, regional projects and localized energy solutions are enabling companies to cater to specific needs, ensuring steady market expansion.

The report provides a comprehensive analysis of the competitive landscape in the Australia energy storage market with detailed profiles of all major companies.

Latest News and Developments:

• On December 5, 2024, Wartsila announced its selection by Origin Energy to deliver the third stage of the Eraring battery facility in New South Wales, Australia. This expansion will add 700 MWh of energy storage, bringing the facility's total capacity to 700 MW/2,800 MWh, making it the largest battery project in Australia and among the largest globally. The Eraring battery will integrate with Australia’s National Electricity Market, strengthening energy reliability and security as the contribution of renewable energy continues to grow.
• On December 3, 2024, Eku Energy and Shell Energy announced the completion of the 200MW/400MWh Rangebank Battery Energy Storage System (BESS) in Cranbourne, Victoria, now the state's second-largest BESS. This facility, connected to the Victorian Shared Transmission System via the Cranbourne Terminal Station, aims to enhance grid stability by discharging stored energy during peak demand periods. Under a 20-year tolling agreement, Shell Energy will have full access to the BESS's capacity, marking its first direct equity investment in a utility-scale battery storage project globally.

Australia Energy Storage Market Report Scope:

Key Benefits for Stakeholders:

• IMARC’s report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the Australia energy storage market from 2019-2033.
• The research study provides the latest information on the market drivers, challenges, and opportunities in the Australia energy storage market.
• Porter's Five Forces analysis assists stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the Australia energy storage industry and its attractiveness.
• Competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.