We estimate that the cost of energy storage systems will be:
2024: between 300 and 400 USD per kWh
2025: between 220 and 320 USD per kWh
2026: between 150 and 200 USD per kWh
Investors should decide whether to focus on initial investment cost or on investment efficiency.
Investment efficiency = (Total Earnings During System Lifetime) / (Investment Cost)
1. Battery Cell Type and Quality
This is the most important factor.
The brand, model, and quality of the battery cells directly affect system cost and lifetime.
When calculating the cost of a storage unit, we must look at:
Cost per charge/discharge cycle
How much energy is stored and recovered in each cycle
Currently, available battery cells in the market offer 2,000 to 12,000 cycles of lifetime.
While evaluating cycle life, pay attention to Depth of Discharge (DOD) and C-Rate values.
Since the storage system works as a whole, the quality and lifetime of every component matters.
After the investment cost is recovered, what matters is how much profit the system can still generate during its remaining life.
2. Charge/Discharge Rate or Capacity
Depending on project needs, systems can be designed for 0.5C or 1C operation, which directly affects PCS (Power Conversion System) costs.
For example:
If the system is designed for 1C, PCS costs can be almost twice as high as for 0.5C.
Assume for 2023:
Battery cost: 200 USD/kWh
PCS cost: 50 USD/kVA
Then:
A 1C system will cost around 250 USD/kWh
A 0.5C system will cost around 225 USD/kWh (for main components)
Additional fixed costs will include:
transformer, cabling, cabinets, fire systems, EMS, and EPC services.
3. Unit Capacity per Module
Systems can be built as distributed or centralized.
In hybrid solar projects, PV-input PCS units can be used.
In existing solar plants, ESS units can be added with PCS-only configurations.
Some projects prefer 220–330 kWh modular systems — slightly higher in cost, but better for installation, maintenance, operation, and risk management.
Alternatively, large containerized systems reduce costs but concentrate risk in one location.
If you don’t have enough technical knowledge about the system, it is important to carefully evaluate every parameter and perform a proper feasibility study.
Otherwise, the system might reach the end of its life before paying back its own cost, leading to a negative return on investment.
For project support and professional consultation, you can contact Orbit Enerji A.Ş. at 444 1 672.
Date: January 7, 2024