Global Home Energy Storage Systems Market: A Report on Growth, Trends, and Contribution to Sustainable Development Goals

Executive Summary

The global market for Home Energy Storage Systems (HESS) is undergoing significant expansion, driven by the global transition towards renewable energy and the need for enhanced grid stability. Valued at USD 2.82 billion in 2024, the market is projected to reach USD 6.89 billion by 2034, with a Compound Annual Growth Rate (CAGR) of 9.35%. This growth is intrinsically linked to the advancement of the United Nations’ Sustainable Development Goals (SDGs), particularly SDG 7 (Affordable and Clean Energy), SDG 11 (Sustainable Cities and Communities), and SDG 13 (Climate Action). HESS enables households to store electricity, often from renewable sources like solar panels, thereby increasing energy independence, providing backup power, and reducing reliance on fossil fuels. This report analyzes the market dynamics, segmentation, and regional trends, with a specific focus on how the HESS industry contributes to a sustainable and resilient global energy infrastructure.

Market Projections and Key Performance Indicators

Financial Outlook

• Market Valuation (2024): USD 2.82 Billion
• Projected Market Valuation (2034): USD 6.89 Billion
• Forecasted CAGR (2025-2034): 9.35%

Market Segmentation Highlights (2024)

1. Leading Region: North America (45% market share)
2. Dominant Battery Technology: Lithium-ion (70% market share)
3. Leading Capacity Segment: 10–20 kWh (40% market share)
4. Dominant Connectivity Type: On-Grid Systems (60% market share)
5. Primary End-User: Single-Family Homes (55% market share)

Market Dynamics and Alignment with Sustainable Development Goals

Drivers: Accelerating the Clean Energy Transition (SDG 7 & SDG 13)

The primary driver for the HESS market is the increasing integration of intermittent renewable energy sources such as solar and wind. By storing excess energy generated during peak production times, HESS ensures a stable and reliable power supply, directly supporting SDG 7 by making clean energy more accessible and dependable. This capability is crucial for reducing greenhouse gas emissions and advancing climate action initiatives as outlined in SDG 13.

Restraints: Addressing Affordability Challenges (SDG 7)

The high initial capital investment for HESS, including batteries, inverters, and installation, remains a significant barrier to widespread adoption. This cost factor presents a challenge to the “affordable” aspect of SDG 7. However, declining battery costs, coupled with government incentives and subsidies, are progressively making these systems more accessible to a broader consumer base, thereby mitigating this restraint.

Opportunities: Building Resilient and Sustainable Communities (SDG 11)

The development of Virtual Power Plants (VPPs) represents a transformative opportunity for the HESS market. VPPs aggregate distributed energy resources, including home batteries, into a collective network that can enhance the stability of the main electrical grid. This model supports the creation of resilient, decentralized energy infrastructure, a core component of SDG 11, by empowering communities to manage their energy resources effectively and contribute to a more stable and cleaner energy system.

Segment Analysis: A Focus on Sustainability and Innovation

Battery Type Insights

• Lithium-ion Batteries: This segment’s dominance is attributed to its high energy density and efficiency, which are vital for effectively storing renewable energy and supporting SDG 7. Continuous improvements in manufacturing are lowering costs and enhancing their role in the clean energy transition.
• Sodium-ion Batteries: Projected to be the fastest-growing segment, sodium-ion technology aligns strongly with SDG 12 (Responsible Consumption and Production). Its reliance on abundant and less environmentally impactful materials reduces dependence on critical minerals like lithium and cobalt, promoting a more sustainable supply chain.

Capacity Insights

• 10–20 kWh Segment: The leading capacity range provides an optimal balance for residential backup power and daily energy management, empowering households to increase their use of self-generated clean energy (SDG 7).
• >20 kWh Segment: The anticipated growth in this segment reflects a rising demand for greater energy independence and resilience, particularly in regions prone to grid instability. These larger systems are key to ensuring energy security in the face of climate-related disruptions, contributing to SDG 11 and SDG 13.

Connectivity Insights

• On-Grid Systems: These systems are fundamental to modernizing the electrical grid. By storing excess solar energy and reducing peak demand, they enhance grid stability and facilitate a higher penetration of renewables, directly contributing to SDG 7 and SDG 11.
• Hybrid Systems: The rapid growth of hybrid systems is driven by the need for energy resilience. Their ability to operate both on and off-grid provides a reliable power supply during outages, supporting climate adaptation efforts (SDG 13) and fostering sustainable communities (SDG 11).

End-User Insights

• Single-Family Homes: The high adoption rate in this segment demonstrates a grassroots movement towards decentralized, clean energy. Homeowners are actively participating in the energy transition, reducing their carbon footprint and contributing to SDG 13.
• Multi-Family Homes: The emerging growth in this segment is crucial for promoting energy equity and sustainable urbanization (SDG 11). Community-based storage solutions allow residents of multi-unit buildings to share the benefits of renewable energy and cost savings.

Regional Analysis and Global SDG Contributions

North America

North America’s market leadership is propelled by supportive government policies like the U.S. Inflation Reduction Act, which provides significant incentives for clean energy adoption. These policies accelerate the transition to a low-carbon economy, directly aligning with national commitments to SDG 7 and SDG 13. States like California are at the forefront, integrating HESS to build a more resilient grid capable of handling high volumes of renewable energy.

Asia Pacific

As the fastest-growing region, Asia Pacific is leveraging HESS to meet rising energy demand sustainably. Governments in China, India, and Japan are implementing policies to promote energy storage as a means to achieve energy independence and meet climate targets. This rapid adoption is critical for the global effort to combat climate change (SDG 13) and ensure universal access to clean energy (SDG 7).

Global Regulatory and Investment Landscape

Nations worldwide are implementing regulatory frameworks and financial incentives to accelerate HESS deployment, underscoring a global commitment to the SDGs.

• United States: Federal tax credits and state-level programs like California’s SGIP directly subsidize residential storage, promoting clean energy adoption.
• Germany: Government subsidies and favorable financing have made Germany a European leader, advancing the continent’s renewable energy goals.
• China: National mandates for energy storage capacity are aimed at stabilizing the grid and reducing reliance on fossil fuels.
• India: Viability Gap Funding (VGF) for battery projects is designed to scale up energy storage to support the country’s ambitious renewable energy targets.

Technological Outlook and Future Trends

The Role of Artificial Intelligence (AI)

AI is revolutionizing HESS by enabling intelligent energy management. AI algorithms optimize energy storage and consumption based on real-time electricity prices and weather forecasts, maximizing efficiency and cost savings. This technological advancement supports SDG 12 by promoting responsible energy consumption and reducing waste.

Emphasis on Sustainable Battery Technologies

The industry is increasingly focused on sustainability, with research and development directed towards batteries with longer lifecycles, higher efficiency, and greater recyclability. The shift towards chemistries like sodium-ion and advancements in solid-state batteries reflect a commitment to SDG 12 by minimizing environmental impact and creating a circular economy for energy storage solutions.

Analysis of Sustainable Development Goals (SDGs) in the Home Energy Storage Systems Market

1. Which SDGs are addressed or connected to the issues highlighted in the article?

• SDG 7: Affordable and Clean Energy

  The article is fundamentally about technologies that support clean energy. It discusses how home energy storage systems are crucial for the “growing integration of renewable energy sources, particularly solar power,” and for providing a “reliable backup power supply,” which directly aligns with the goal of ensuring access to affordable, reliable, and clean energy.

• SDG 9: Industry, Innovation, and Infrastructure

  The text highlights significant innovation and infrastructure development. It details “technological advancements in battery efficiency,” the use of “Artificial intelligence (AI) … for advanced energy management,” and the development of new infrastructure models like “virtual power plants.” This points to building resilient infrastructure and fostering innovation.

• SDG 11: Sustainable Cities and Communities

  The article addresses energy solutions for residential settings, including “single-family homes” and “multi-family homes.” By enabling energy independence, providing backup power during outages, and integrating with renewables, these systems contribute to making homes and communities more resilient and sustainable.

• SDG 12: Responsible Consumption and Production

  The article notes a key trend towards sustainability in the industry. It mentions a “strong emphasis is placed on developing more sustainable energy storage solutions, including batteries with longer life cycles, improved energy efficiency, and recycled content,” which directly relates to sustainable production patterns.

• SDG 13: Climate Action

  By facilitating the shift away from fossil fuels, the technology discussed is a key tool for climate action. The article states that hybrid systems help in “reducing dependence on fossil fuels and supporting global sustainability goals,” and that a driver for adoption is homeowners seeking to “lower their carbon footprint.”

2. What specific targets under those SDGs can be identified based on the article’s content?

• Target 7.1: Ensure universal access to affordable, reliable and modern energy services.

  The article addresses this by highlighting how home energy storage systems “ensure a reliable backup power supply during outages” and enhance “energy independence,” which are key components of reliable energy services for households.

• Target 7.2: Increase substantially the share of renewable energy in the global energy mix.

  This is a central theme. The article states that the primary market driver is the “growing integration of renewable energy sources” and that these systems are “crucial for capturing excess energy” from intermittent sources like solar and wind, making them more practical and reliable.

• Target 9.4: Upgrade infrastructure and retrofit industries to make them sustainable…and promote clean technologies.

  The article describes the development of “virtual power plants” where home batteries form a “collective network of distributed energy resources,” representing a significant upgrade to energy infrastructure. The entire market growth is based on the adoption of a clean technology.

• Target 12.5: By 2030, substantially reduce waste generation through prevention, reduction, recycling and reuse.

  The article points to this target by mentioning the industry’s focus on sustainability, specifically through developing batteries with “longer life cycles” and “recycled content,” which are methods to reduce waste.

• Target 13.2: Integrate climate change measures into national policies, strategies and planning.

  The article provides numerous examples of this, detailing supportive government policies such as the “U.S. Inflation Reduction Act,” “Canada Greener Homes Initiative,” China’s goal for “30 GW of new energy storage capacity by 2025,” and India’s “viability gap funding (VGF) for Battery Energy Storage System (BESS) projects.”

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

• Market Growth as an Indicator of Clean Energy Adoption (Target 7.2)

  The projected market growth from “USD 2.82 billion in 2024… to approximately USD 6.89 billion by 2034” at a “CAGR of 9.35%” serves as a direct quantitative indicator of the increasing adoption of technology that enables renewable energy integration.

• Government Investment and Policy Implementation (Target 13.2)

  The article lists specific financial and policy commitments that can be used as indicators. Examples include the “30% tax credit” from the U.S. Inflation Reduction Act, Australia’s rebate of “A$372 per kWh,” and China’s national plan to add “30 GW of new energy storage capacity by 2025.” These represent concrete actions to integrate climate measures into national planning.

• Share of Renewable-Enabling Technology (Target 7.2)

  The market share data for different system types implies progress. The fact that “on-grid systems segment dominated the market, accounting for about 60% share in 2024” is an indicator, as these systems are primarily used to “store excess solar energy.”

• Technological Advancements in Sustainability (Target 12.5)

  The development and market penetration of more sustainable battery types can be an indicator. The article notes that the “sodium-ion batteries segment is expected to grow at the fastest rate,” citing their “sustainability owing to less reliance on lithium” as a key reason.

4. SDGs, Targets, and Indicators Table

Source: precedenceresearch.com