the economics

861MWThe projected size of the annual U.S. storage market by 2019.

(Greentech Media, 2015)

A glimpse into the past, present, and future of energy storage

Facts & Figures

Growth in the Energy Storage Market

11,000MWThe projected amount of global energystorage deployment (MW) by 2020.

(BBC, 2015)

45%The projected market share of behind the meter energy storage by the year 2019.

(Utility Dive, 2015)

$19billionThe projected value ofthe storage industry by 2017, up from $200 million in 2012.

(Sandia, 2015)

ENERGY STORAGE

IronOak Energy Insights • www.insights.ironoak.energy • +1 (888) 249-3013 • Chapel Hill, NC, USA

Meg

awat

ts (M

W)

U.S. Energy Storage Deployment

(Greentech Media, 2015)

0

10

20

30

40

50

60

Q3 2015Q3 2014Q3 2013

Front of the meterBehind the meter

13.9%

0.8%

0.2%

2015

2014

2013

41%The amount Grid-Scale Balance-of-System Costs will decline by 2020, from $670 per kWto $400 per kW.

(Greentech Media, 2014)

38%The average percentage industry participants expect the capital cost of flow batteries to fall by 2020.

(Lazard, 2015)

The Economics of Energy StorageHow much costs have fallen, and how far they have yet to go

2025

30

1520 20

1015

10

2014 2015 20160

10

20

30

2025301520201015102014201520160102030

20 25 3015 20 2010 15 10

2014201520160102030

0

200

400

600

800

1000

1200

2015 2016E 2017E 2018E 2019E 2020E

Storag

e Syst

em Co

st - 2

hr. D

uratio

n ($/k

Wh) $1,030

$941$859

$784$716

$654

Projected Commercial Storage System Costs

7.3% Compound Annual Cost Reduction

Facts & Figures47%The average percentage industry participants expect the capital cost of lithium ion batteries to fall by 2020.

(Lazard, 2015)

“There are four challenges to the widespread deployment of energy storage: cost competitive technologies & grid integration, validated reli-ability & safety, equitable regulatory environ-ment, and industry acceptance.” (Sandia, 2015)

“Some storage technologies are already cost-competitive with conventional alternatives in certain applications like frequency regulation or deferring distribution investment.”

(Utility Dive, 2015)

(Greentech Media, 2015)

IronOak Energy Insights • www.insights.ironoak.energy • +1 (888) 249-3013 • Chapel Hill, NC, USA

>50% The percentage battery system and technology prices have declined since 2010.

(Moody’s Investor Services, 2015)

The Benefits and Uses of Energy Storage“In front of the meter” vs. “behind the meter” storage

“The prevailing energy storage business model in the U.S. uses a battery to deliver a single service to a single stakeholder and typically only takes 1-50% of a battery’s lifetime capacity. Batteries must deliver multiple services to customers and the grid in order to shift economics in favor of storage.”

(Rocky Mountain Institute, 2015)

“In most cases, two or more benefits must be combined for total benefits to exceed total costs. So the concept of stacking of benefits - into a viable and attractive value proposition - is very important.” (ESA, 2015)

IronOak Energy Insights • www.insights.ironoak.energy • +1 (888) 249-3013 • Chapel Hill, NC, USA

“Behind the Meter” “In front of the Meter”Customer-sited storage Utility-sited storage

Customer Service ISO/RTO Services

0 50 100 150 200 250

Time-of-Use Bill Management

Peak Shaving

Distribution Deferral

Resource Adequacy

Frequency Reduction

Energy Arbitrage

Energy Storage Service Valuation

Service Value ($/kWh-year)

Utility Services

(Rocky Mountain Institute, 2015)