New ways to store electricity will be a “game changer” for the generation of variable renewable energy, with battery use expected to increase substantially over the next few years. The largest markets are expected to be in North America, Europe and the Asia-Pacific, says a report just out. 

Total available battery storage for electricity will increase from just 0.8 GW today to around 250 GW by 2030, according to the report REThinking Energy 2017 released by the International Renewable Energy Agency (IRENA). 

It puts the world market value of battery storage at $2.2 billion in 2015 and says it is expected to rise to $14 billion by 2020. “Different types of batteries have different uses, but recent years have seen a significant shift from sodium sulphur to other battery types, particularly lithium-ion,” it says. The cost of lithium-ion batteries for energy storage fell by 65 percent in the five years between 2010 and 2015, it points out. 

But there are mixed views on the future price of lithium, an in-demand commodity. Analysts at Morningstar Inc (NASDAQ:MORN) said they expect lithium demand to rise 16 percent a year from 175,000 tonnes in 2015 to 775,000 tonnes by 2025. That is an increase that they say would be the fastest of any significant commodity over the past century. They forecast a supply shortfall by 2025 of 100,000 tonnes of lithium. 

Electric cars use almost five times as much lithium as a smartphone, said the Financial Times recently. “With vehicles such as the Tesla (NASDAQ:TSLA) Model 3 and the Chevrolet Bolt (made by General Motors Company (NYSE:GM) set for mass production, there is considerable excitement about the prospects for the metal,” it added. 

But the FT report also said that as there is no geological shortage of lithium, some commentators believe the mining industry will rise to the supply challenge.

Batteries are rated to be only the second most mature technology for energy storage after pumped hydro storage, according to the IRENA report. But, while such pumped hydro storage facilities are also expected to increase – from 150GW in 2014 to 325GW by 2030, it suggested they include complicating factors of high capital expenditure and finding a suitable geographic location.

Speaking more generally: “Renewables are gaining ground by nearly every measure. Accelerating the pace of the energy transition and expanding its scope beyond the power sector will not only reduce carbon emissions, it will improve lives, create jobs, achieve development goals, and ensure a cleaner and more prosperous future,” said Adnan Z. Amin, Director-General of IRENA.

In the power sector, breakthroughs in complementary systems, in particular storage, will enable the integration of larger shares of renewable electricity, says the report. Off-grid renewables – via both stand-alone systems and mini-grids – can increasingly complement grid-based options to expand sustainable energy access, it suggests.

Global PV capacity rose from 40 GW in 2010 to 219 GW in 2015, says IRENA. Solar PV, it says, will grow the fastest in terms of capacity and output and could to account for as much as 7 percent of global power generation by 2030 – a six-fold increase from today.

Dina Medland is an independent writer, editor and commentator with a strong focus on issues around corporate governance, ethics, the workings of the boardroom and sustainable business. She is on the team of contributors to @ForbesEurope and is an ex-Financial Times staff member who has been a regular contributor in recent years. Further details about her background and a portfolio of work – including her commercially sponsored blog ‘Board Talk’ are available on her website http://www.dinamedland.com