Much like the “holy grail” to which it is often compared, cost-effective and readily deployable energy storage technologies have always seemed to be out of reach.  Developments in recent years, however, suggest that 2015 may be the year when the electric utility industry and its customers begin to seize the reality and opportunity of energy storage.

The headlines over the last two years have generated considerable excitement for the future of energy storage.  The prospects for energy storage took a big step forward in 2013 when California required its investor-owned electric utilities to implement more than 1,300 MW of energy storage capabilities throughout their respective systems by 2020.  Then, in 2014, Elon Musk announced plans for a “Gigafactory” to be located in Nevada with the potential to produce 50 GWh of batteries per year, and Alevo announced its plans to launch a major battery production facility in a former cigarette plant in North Carolina.  These ambitious manufacturing developments were matched by the scale of Oncor’s 2014 proposal to invest $5 billion in 5 GW of energy storage systems to be installed over the next five years throughout its Texas-based distribution and transmission system.

These attention-grabbing headlines were accompanied by a series of other reports of advancements in energy storage technology as well as numerous new projects, my personal favorite of which was RES Americas’ nod to“The Blues Brothers” movie with the twin 19.8 MW “Jake” and “Elwood” energy storage facilities to be constructed outside Chicago.

Now, the momentum that appeared to be building last year has continued into 2015 with various market analyses predicting a bullish future for energy storage.  Earlier this month, Navigant Research released new studies estimating that the global market for distributed energy storage systems (i.e., systems designed for community, residential, and commercial storage applications) would grow from $452 million per year in 2014 to more than $16 billion in 2024, and the worldwide market for utility scale energy storage technologies would grow from $164 million per year in 2014 to more than $2 billion in 2023 with total revenues of $68.5 billion in the ten years ending in 2024.

These prognostications were accompanied by other similarly optimistic reports for specific energy storage technologies.  Research and Markets forecast that the global compressed air energy storage market would see a compound annual growth rate of 25.5% from 2014 to 2019.  GTM Research forecast that the solar PV-plus-storage market would grow from $48 million per year in 2014 to about $1 billion per year in 2018 with ten percent of all new commercial solar installations being paired with energy storage capabilities leading to a total installed capacity of 318 MW by 2018.

This market optimism does not appear to be limited to industry analysts.  Investors also appear to recognize the growing potential of energy storage as evidenced by news of recent investments in Eos Energy Storage ($ 15 million private placement with a further planned $10 million placement with accredited investors) and Stem ($27 million equity financing), among others.

On the regulatory front, California made news again when earlier this month it released its “Energy Storage Roadmap” developed by the California Independent System Operator, the California Public Utilities Commission, and the California Energy Commission with input from more than 400 stakeholders.  Following California Governor Jerry Brown’s proposal in his January 5, 2015 inaugural address that the state should work toward achieving 50% renewable energy by 2030, the Roadmap focuses on certain stakeholder-identified high priority concerns including expanding revenue opportunities for energy storage applications, reducing costs of integrating and connecting energy storage systems to the grid, and providing greater certainty concerning regulatory treatment for energy storage resources.  While the Roadmap makes clear that it is not intended to lay out a timeline or plan for implementing solutions to these concerns, it is intended to inform future California regulatory proceedings and the development of additional initiatives and policies.  With several other states from New York to Oregon considering how to address energy storage from a policy and regulatory standpoint, it remains to be seen what effect California’s aggressive efforts will have in other states.

As mentioned, energy storage has often been referred to as the “holy grail” of the electric utility industry.  The developments of the last two years and the first few weeks of this year suggest that it may be time to retire that comparison.  If so, let me suggest a new metaphor: “Goldilocks and the Three Bears.”  Just as the porridge had to be “just right” for Goldilocks, the confluence of technology, manufacturing capability, industry and customer acceptance, deployed projects, financial investment, and policy and regulatory support may make 2015 “just right” for energy storage to finally take-off.