Rapid Growth of the Global Battery Storage Market by 2025 and the Strategic Position of Korean Companies
Editor
The global Battery Energy Storage System (BESS) market is experiencing unprecedented growth, reshaping the landscape of the energy industry. According to the latest report from Bloomberg NEF, the global BESS market size is projected to reach $120 billion by 2025, marking a 45% increase from the previous year. This rapid growth is driven by a combination of increased renewable energy generation, the need for grid modernization, and carbon neutrality policies from governments worldwide. Notably, the U.S. Inflation Reduction Act (IRA), the European Union’s Green Deal, and China’s 14th Five-Year Plan are major drivers of BESS market growth, intensifying investment and technological development competition among related companies.
Korean companies occupy a unique position at the center of this market growth. LG Energy Solution, headquartered in Ochang, Gyeonggi Province, maintains its leading position with a 23.4% market share in the global ESS battery market as of the third quarter of 2025. The company announced plans to build battery plants in Michigan and Arizona, USA, with a total investment of $18 billion this year and aims to triple its ESS battery production capacity from the current 15GWh to 45GWh by 2026. Samsung SDI is also leveraging its technology developed in Yongin, Gyeonggi Province, to target the global market through its plants in Hungary and Malaysia, investing 2 trillion won annually in the development of next-generation solid-state battery technology.
The aggressive market entry of Chinese companies is also noteworthy. CATL, headquartered in Ningde, Fujian Province, holds a dominant 35.8% market share in the global battery market as of 2025. In the first half of this year alone, the company recorded 34 billion yuan (approximately $4.7 billion) in sales in the ESS sector, a 78% increase from the same period last year. CATL’s growth secret lies in the cost competitiveness of its lithium iron phosphate (LFP) batteries, leading the market with an industry-low price of $80 per kWh. BYD, headquartered in Shenzhen, is also making a full-scale entry into the ESS market based on its accumulated technology in automotive batteries, setting a sales target of 18 billion yuan for the ESS sector by 2025.
A New Dimension of Technological Innovation and Performance Competition
The technological competition in the BESS market is evolving beyond mere capacity expansion to a multidimensional competition in efficiency, safety, and lifespan extension. LG Energy Solution’s recently unveiled next-generation NCMA (Nickel-Cobalt-Manganese-Aluminum) battery achieves an energy density of 300Wh/kg, showing a 20% performance improvement over existing models. This innovation significantly enhances efficiency per installation area by storing more energy in the same space. The company has also commercialized technology that optimizes charge-discharge cycles through an AI-based Battery Management System (BMS), extending battery life by 30% compared to existing models.
Samsung SDI is seeking differentiation in solid-state battery technology. The solid-state battery developed by the company boasts twice the energy density and ten times faster charging speed compared to conventional lithium-ion batteries. It maintains stable performance in extreme temperature environments ranging from -40 to 80 degrees Celsius, making it ideal for renewable energy projects in polar or desert regions. Samsung SDI plans to begin commercial mass production of solid-state batteries in 2026, with an initial production capacity of 5GWh annually.
U.S. companies are also not lagging in technological innovation. Fluence Energy, headquartered in Arlington, Virginia, is implementing a software-centric differentiation strategy. The company’s AI-based energy management platform ‘Mosaic’ improves ESS operational efficiency by 25% through real-time power demand forecasting and optimal charge-discharge scheduling. Fluence is operating ESS projects with a total capacity of 18GW in 85 countries worldwide as of 2025, with third-quarter sales this year increasing by 62% year-on-year to $840 million.
Tesla is leading the large-scale ESS market with its Megapack system produced in Austin, Texas. The 3.9MWh capacity Megapack features a modular design with excellent scalability and is equipped with Tesla’s proprietary 4680 battery cells, ensuring a lifespan of over 20 years. The company achieved $3 billion in sales in the ESS sector in the first half of this year, a 130% increase from the same period last year, and plans to expand Megapack production capacity from the current 40GWh to 100GWh by 2026.
Market Dynamics and Geopolitical Changes
The geopolitical structure of the BESS market is intertwined with the U.S.-China technological hegemony competition, presenting a complex landscape. The U.S. increased tariffs on Chinese batteries from 7.5% to 25% in 2025 and is pursuing legislation to ban the use of Chinese batteries in federal government projects starting in 2026. These policy changes provide new opportunities for Korean companies. LG Energy Solution’s market share in the U.S. surged from 18% in 2024 to 27% in 2025, while Samsung SDI’s share slightly decreased from 22% to 19%, but it still maintains a strong market position.
In the European market, establishing a regional battery supply chain has emerged as a key issue. With the European Union’s Battery Regulation set to take effect in 2025, mandatory carbon footprint disclosure and minimum recycling rate standards have been introduced. In response, Korean companies are actively pursuing local production and eco-friendly processes in Europe. LG Energy Solution has begun producing batteries using 100% renewable energy at its plant in Wroclaw, Poland, while Samsung SDI is promoting carbon-neutral production through solar power at its plant in Göd, Hungary.
The Chinese market remains the world’s largest ESS market, with new installation capacity expected to reach 25GWh by 2025. China’s ‘Double Carbon’ policy, which aims to peak carbon emissions by 2030 and achieve carbon neutrality by 2060, has set a target to increase the share of renewable energy to 25% by 2030, leading to a surge in ESS demand. CATL is accelerating its overseas expansion based on this domestic market growth, pursuing battery plant construction projects worth a total of 12 billion euros in Thuringia, Germany, and Hungary.
The growth of emerging markets is also noteworthy. India’s ESS market size is expected to reach $4.5 billion by 2025, an 85% increase from the previous year, with the government’s ‘National Energy Storage Mission’ targeting 50GWh of ESS installations by 2030. The Southeast Asian market is also rapidly growing, centered around Thailand, Vietnam, and Indonesia, with the region’s ESS market size estimated at $2.8 billion by 2025. Korean companies are expanding their market share in these markets based on their technological prowess and quality superiority.
From a financial investment perspective, global ESS-related venture investments totaled $8.7 billion in the first half of 2025, a 34% increase from the same period last year. Investments are particularly concentrated in next-generation battery technology and AI-based energy management systems. U.S. private equity firm KKR has established a $5 billion investment fund for ESS specialist companies, and Japan’s SoftBank Vision Fund has announced plans to invest $3 billion in battery technology startups. This capital influx is accelerating technological innovation and intensifying market competition.
Looking ahead, the global BESS market is expected to maintain an average annual growth rate of 25%, reaching $350 billion by 2030. This growth will be supported by various factors, including grid modernization, expansion of electric vehicle charging infrastructure, and microgrid construction. Korean companies are expected to benefit from this growth through technological innovation and the establishment of a global production network, but continuous investment and strategic partnerships will be necessary to respond to the price competitiveness of Chinese companies and the software capabilities of U.S. companies. In particular, the development of next-generation battery technology, implementation of a circular economy, and development of AI-based optimization solutions are expected to be key elements of future competitiveness.
*This analysis is based on publicly available market data and industry reports, and additional due diligence and expert consultation are required for investment decisions.*
