Anza Renewables Unveils Q1 2025 US Energy Storage Pricing Insights Amid Tariff Impacts

AC-integrated systems, often referred to as “all-in-one” solutions, are gaining traction among system integrators and battery original equipment manufacturers (OEMs). Anza Renewables, a procurement platform, has released its inaugural quarterly report on US energy storage pricing, which includes insights on battery cell costs, AC and DC-integrated systems, list prices, and more. The report emphasizes that tariffs will continue to influence pricing strategies.

In the first quarter of 2025, the data reflects market conditions before the implementation of a 10% universal tariff on Chinese imports announced by US President Donald Trump. This tariff is expected to have a considerable impact on pricing. The report indicates a slight decrease in prices from August 2024 to January 31, 2025, as suppliers adjust quotes and deal structures in response to the import tariff. Furthermore, the International Trade Commission’s (ITC) preliminary ruling on January 31, suggesting that Chinese active anode material could harm the US industry, adds further complexity to the tariff landscape.

The prices of lithium carbonate are stabilizing, which helps mitigate cost fluctuations in battery cell pricing. After a steady increase from August to mid-November 2024, the Lithium Carbonate Index (LCO) entered February at $77,500. Anza’s findings reveal that more manufacturers are entering the storage market than ever, which is intensifying competition and exerting downward pressure on prices. This competitive landscape has contributed to a decline in list prices compared to previous quarters.

The report also highlights the increasing popularity of AC-integrated systems and notes a trend toward DC-integrated OEM wraps, which are causing pricing variability and margin compression in integration services. For instance, Fluence, a US-based energy storage system integrator and digital energy services provider, recently introduced a new AC-based modular battery storage platform, set for delivery in the fourth quarter of this year.

Anza’s analysis shows that the expansion of supplier options and volume discounts for larger projects are driving prices lower for utility-scale projects. Moreover, increased competition from smaller project suppliers is narrowing the gap between distributed generation (DG) and utility-scale projects. The report includes a comparison of a 40MW, 4-hour DG system with a 200MW, 4-hour utility-scale project. The analysis indicates that median AC pricing for the DG system decreased by approximately $4/kWh (about 3.0%), while median DC pricing fell by roughly $3/kWh (around 2.9%). In contrast, the utility-scale analysis showed only a modest decline: median AC pricing dropped by about $1/kWh (approximately 0.8%), and median DC pricing decreased by roughly $4/kWh (around 3.7%).

Anza’s report indicates that storage supplier pricing has remained relatively stable in recent weeks, but the tariffs enacted in early February and the ITC’s affirmative determination regarding Chinese imports are poised to bring significant changes to the industry in the near future. A separate Q2 2024 quarterly battery energy storage system (BESS) pricing survey conducted by Clean Energy Associates (CEA) also noted heightened market competition, with a trend toward larger battery cells of 300Ah or more and the use of 20ft containers.

Additionally, the recently released BloombergNEF Energy Storage System Cost Survey 2024, which examines utility-scale batteries globally, reported a 40% year-on-year decrease in the prices of turnkey energy storage systems, bringing the global average down to $165/kWh. This marks the most significant annual decline since the survey began in 2017. The survey found that the average price for a turnkey BESS in the US stands at $275/kWh, with regional analyses covering China, the US, Europe, and the rest of the world. Analyst Isshu Kikuma from BNEF highlighted that a potential 60% tariff could lead to a similar increase in costs for turnkey energy storage systems, marking a substantial price hike if implemented.

Despite these challenges, BNEF anticipates that tariffs will not hinder the growth of energy storage deployments in the US.

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For more insights into the evolving landscape of energy storage pricing, stay tuned to future reports and analyses.