
ID : MRU_ 442032 | Date : Feb, 2026 | Pages : 248 | Region : Global | Publisher : MRU
The Solar Storage Batteries Market is projected to grow at a Compound Annual Growth Rate (CAGR) of 15.5% between 2026 and 2033. The market is estimated at USD 4.5 Billion in 2026 and is projected to reach USD 12.3 Billion by the end of the forecast period in 2033.
The Solar Storage Batteries Market encompasses advanced electrochemical energy storage solutions designed to capture and retain solar energy generated by photovoltaic (PV) systems for later use. This critical technology addresses the inherent intermittency of solar power, enabling seamless energy supply during periods of low sunlight or high demand. The primary products driving this market include Lithium-ion (Li-ion) batteries, specifically Nickel Manganese Cobalt (NMC) and Lithium Iron Phosphate (LFP) chemistries, alongside emerging technologies such as flow batteries and solid-state solutions. These batteries are foundational to establishing grid resilience and maximizing the financial and environmental benefits of solar installations across various scales.
Major applications of solar storage batteries span across residential, commercial & industrial (C&I), and utility-scale sectors. In residential settings, they facilitate self-consumption optimization, reduce reliance on grid electricity during peak pricing, and provide critical backup power during outages. For C&I users, storage solutions enable demand charge management, load shifting, and power quality improvements, leading to substantial operational cost reductions. At the utility level, they are essential for integrating high penetrations of renewable energy, providing grid stability services such as frequency regulation and spinning reserves, and deferring costly infrastructure upgrades. The integration of sophisticated Battery Management Systems (BMS) ensures optimal performance, longevity, and safety of these storage assets.
The market growth is primarily driven by rapidly declining battery costs, increased global commitments to decarbonization and renewable energy targets, and robust governmental incentives such as feed-in tariffs, tax credits, and net metering reforms favoring self-consumption. Furthermore, the growing need for energy security and resilience against extreme weather events and geopolitical instability accelerates adoption. Continuous advancements in battery chemistry, coupled with enhanced manufacturing efficiencies and scale, are making solar-plus-storage systems economically viable and highly attractive compared to traditional energy sources, positioning them as a cornerstone of the future decentralized energy landscape.
The Solar Storage Batteries Market is experiencing robust expansion, characterized by significant business trends centered on vertical integration, strategic partnerships between battery manufacturers and solar installers, and a strong emphasis on scaling up production capacity, particularly for Lithium Iron Phosphate (LFP) chemistries due to their safety profile and lower cost. Regional trends show that Asia Pacific (APAC), led by China and India, dominates manufacturing and deployment, driven by aggressive domestic renewable targets and supportive industrial policies. Europe, particularly Germany and the UK, exhibits high growth in the residential sector due to favorable regulatory frameworks promoting grid independence and minimizing transmission costs. North America sees accelerating utility-scale deployment, supported by significant federal initiatives aimed at modernizing the electric grid and bolstering domestic supply chains. Segment trends indicate the C&I sector is emerging as a critical growth area, capitalizing on high peak demand charges and the increasing feasibility of behind-the-meter (BTM) installations, while power capacity ratings exceeding 100 kW are registering the fastest deployment rates, signifying the market shift towards large-scale utility projects designed for grid-level optimization and arbitrage opportunities.
Technological advancement is a central theme, with substantial investments flowing into improving energy density, cycle life, and safety standards. Manufacturers are prioritizing solutions that offer enhanced integration capabilities with smart home energy management systems (HEMS) and virtual power plants (VPPs), thereby unlocking greater value streams for system owners and grid operators alike. The competitive landscape is intensely dynamic, marked by established automotive battery suppliers diversifying into stationary storage and specialized energy storage providers focusing on application-specific solutions. Supply chain resilience remains a key strategic imperative, compelling major players to secure long-term raw material contracts for lithium, cobalt, and nickel, and to invest heavily in robust battery recycling infrastructure to mitigate future material shortages and enhance sustainability credentials across the entire product lifecycle.
Furthermore, regulatory clarity and standardized interconnection procedures are crucial determinants of deployment speed, especially in emerging markets. The market is witnessing a convergence of solar PV inverter technology and battery energy storage system (BESS) components, resulting in simpler installation processes and optimized system performance. This integrated approach, combined with decreasing capital expenditure and increasingly attractive financing models (such as Power Purchase Agreements focused on storage), confirms the transition of solar storage from a niche resiliency product to an essential economic asset for energy providers and end-users, solidifying the forecast for sustained double-digit growth throughout the projected period.
User inquiries regarding the impact of Artificial Intelligence (AI) on the Solar Storage Batteries Market frequently center on themes of operational efficiency, predictive failure analysis, grid integration optimization, and the role of AI in maximizing financial returns from storage assets. Key user concerns revolve around how AI can enhance battery longevity (cycle life), improve the accuracy of renewable energy forecasting to optimize charging schedules, and facilitate the coordination of large fleets of distributed energy resources (DERs) to act as a unified Virtual Power Plant (VPP). Users seek concrete examples of AI applications in energy management systems (EMS) that minimize battery degradation while maximizing arbitrage opportunities and ensuring compliance with complex grid stability requirements, highlighting an expectation that AI will transition battery storage from a simple capacity reserve to a sophisticated, intelligent grid asset that constantly learns and adapts to dynamic energy market conditions and individual consumption patterns.
AI’s influence is profound, fundamentally altering how solar storage systems are managed and monetized. Advanced machine learning algorithms are being employed to analyze vast streams of historical and real-time data—including weather patterns, grid stability indices, energy price forecasts, and individual battery cell performance metrics—to generate highly precise charging and discharging strategies. This capability moves beyond simple rule-based control to predictive optimization, anticipating future energy needs and market fluctuations. For instance, AI algorithms can predict the onset of a cloud cover or a rapid price spike, directing the battery to either conserve charge or inject power into the grid instantaneously, thus maximizing economic yield and minimizing reliance on high-cost peak generation sources.
Moreover, AI plays a crucial role in extending the operational lifespan and ensuring the safety of solar storage systems. By continuously monitoring subtle anomalies in battery performance—such as minor temperature deviations, resistance changes, or voltage imbalances—AI-driven predictive maintenance platforms can identify potential degradation or failure points long before they become critical. This foresight allows operators to intervene proactively, performing targeted maintenance that prevents costly system downtime and catastrophic failures, thereby significantly reducing the Total Cost of Ownership (TCO) for consumers and utility operators. The deployment of AI is therefore not merely an enhancement but a prerequisite for unlocking the full potential and value proposition of high-capacity, distributed solar storage infrastructure.
The dynamics of the Solar Storage Batteries Market are shaped by a complex interplay of Drivers (D), Restraints (R), Opportunities (O), and potent Impact Forces. Key drivers include the overwhelming global mandate for renewable energy integration and grid decarbonization, catalyzed by falling manufacturing costs for Lithium-ion batteries which are achieving grid parity across multiple jurisdictions. Simultaneously, substantial restraints exist, primarily revolving around the volatility and geographical concentration of critical raw material supply chains (lithium, cobalt, nickel), which pose geopolitical risks and contribute to price uncertainty. Opportunities are abundant in the expansion of microgrid solutions for remote areas and military bases, and the emerging Vehicle-to-Grid (V2G) technology, which transforms electric vehicle batteries into mobile storage assets. The dominant impact forces include aggressive government policy support, standardization in safety regulations (especially for LFP chemistries), and intense technological competition focused on commercializing next-generation chemistries like solid-state batteries, which promise higher energy density and superior safety profiles.
A detailed examination of the Drivers reveals that regulatory policy, such as investment tax credits (ITCs) in North America and stringent self-consumption mandates in Europe, directly subsidizes the adoption of solar-plus-storage systems, creating a stable demand foundation. Moreover, increasing frequency and severity of grid outages, often exacerbated by climate change and aging infrastructure, strongly reinforce the value proposition of storage as an essential resiliency tool, driving significant residential and commercial investment in backup power solutions. The ongoing rapid reduction in system installation complexity and the maturation of financing mechanisms, which bundle solar PV and storage into single, attractive packages, further accelerates market penetration, especially among average household consumers seeking predictable long-term energy costs.
Conversely, significant Restraints challenge the market's trajectory. Beyond raw material scarcity and price fluctuations, the primary hurdle remains the capital expenditure (CapEx) required for large-scale storage projects, despite falling component costs. Permitting complexities and fragmented interconnection standards across different regions can introduce substantial delays and increase soft costs. Furthermore, public perception and safety concerns, stemming from high-profile incidents involving thermal runaway in older battery chemistries, necessitate rigorous certification and compliance costs, which can temporarily dampen consumer confidence and adoption rates. Strategic response to these restraints requires massive investment in robust recycling infrastructure and regulatory alignment aimed at streamlining deployment processes while strictly upholding stringent safety protocols.
The inherent Opportunities center on leveraging advanced energy services. The rise of sophisticated aggregation platforms allows distributed battery assets to participate in wholesale energy markets, generating new revenue streams for owners by providing ancillary services such as frequency regulation and capacity peaking. This transformation turns storage from a passive backup system into an active, revenue-generating asset. Furthermore, the development of long-duration energy storage (LDES) solutions, including advanced flow batteries or thermal storage, opens up the potential to address seasonal energy needs and provide multi-day power reliability, a market currently underserved by traditional Li-ion technology. Exploiting these opportunities requires overcoming current technological limitations in energy density and lifetime cycling performance for non-Li-ion alternatives to become economically competitive at scale.
The Solar Storage Batteries Market is meticulously segmented based on battery technology, capacity rating, connectivity (on-grid vs. off-grid), and final application (residential, C&I, utility). This detailed segmentation facilitates precise market sizing and strategic targeting. The technology segment is currently dominated by Lithium-ion batteries, specifically LFP and NMC, which offer high energy density and reasonable cycle life, albeit LFP is rapidly gaining ground due to superior safety and lower material cost volatility. The capacity segment is bifurcated between small-scale (below 10 kW) catering primarily to the residential market and large-scale (above 100 kW) serving utility and large commercial applications. Application segmentation confirms the residential sector's leadership in unit volume, driven by self-consumption and backup needs, while the utility-scale segment leads in total deployed MWh capacity, focusing on grid modernization and renewables integration targets across all major global energy markets.
The value chain for the Solar Storage Batteries Market is extensive, starting from the Upstream segment involving the extraction and processing of critical raw materials such as lithium, cobalt, nickel, and graphite. This stage is characterized by high geopolitical sensitivity, rigorous chemical refinement processes, and substantial capital investment, setting the foundation for battery cell manufacturing. The Midstream stage focuses on cell, module, and pack manufacturing, where specialization in battery chemistry, thermal management system (TMS) design, and the development of sophisticated Battery Management Systems (BMS) occurs. This is followed by the Downstream segment, which encompasses system integration, distribution, installation, and post-sales service, involving a complex network of solar installers, engineering procurement and construction (EPC) firms, and specialized energy service companies (ESCOs) responsible for deploying and managing the final BESS product at the site of use, ensuring safe and optimal operation.
Distribution channels are multifaceted, employing both Direct and Indirect methodologies. Direct sales are common for large-scale utility projects, where manufacturers or specialized integrators contract directly with utilities or independent power producers (IPPs), requiring highly technical sales and long procurement cycles. Indirect distribution dominates the residential and small C&I markets, relying heavily on a robust network of authorized distributors, wholesalers, and certified solar installers who provide bundled services, including PV installation and storage integration. The efficiency of this indirect channel, particularly the skill level of local installers in integrating complex systems and navigating local permitting, significantly influences market adoption rates and consumer satisfaction across various geographical regions.
A critical component of the value chain is the End-of-Life management, which involves the reverse logistics of decommissioning, second-life applications (repurposing batteries for less demanding stationary storage roles), and chemical recycling. As the market matures, the efficiency of recycling infrastructure will become paramount to reducing reliance on volatile raw material supply and enhancing the market's overall sustainability profile. Upstream supply chain stability, midstream manufacturing excellence, and downstream installation efficiency are all interdependent, necessitating continuous collaboration and technological improvement across the entire chain to maintain the rapid pace of solar storage deployment globally, requiring specialized knowledge in material science, power electronics, and sophisticated software integration.
Potential customers for the Solar Storage Batteries Market span a wide array of energy users and providers, segmented primarily into residential homeowners, commercial and industrial (C&I) facilities, and utility and grid operators. Residential customers, driven by the desire for energy independence, reduced electricity bills through time-of-use (TOU) arbitrage, and essential backup power during grid failures, represent the highest volume of installations. Their purchasing decisions are highly sensitive to initial system cost, available government incentives, and the ease of integration with existing rooftop solar PV systems. This segment often prefers standardized, aesthetically pleasing, and safety-certified integrated battery solutions that are easily managed via smart home interfaces, prioritizing long warranties and proven brand reliability in their purchasing criteria.
The Commercial and Industrial sector constitutes a rapidly expanding customer base, targeting solutions for significant operational savings. Their primary drivers include minimizing high demand charges, optimizing consumption during peak tariff periods, and ensuring power quality for sensitive manufacturing processes. These customers typically require modular, scalable systems (10 kW to 1 MW+) that can be tailored to specific load profiles and regulatory environments. For example, large cold storage facilities or manufacturing plants utilize storage to flatten their load profiles and avoid costly peak penalties, thereby integrating the BESS as a core financial optimization tool rather than solely a resilience measure, demanding high performance metrics and integration with existing building management systems (BMS).
Utility and grid operators represent the largest potential customers in terms of total deployed capacity (MWh), utilizing storage primarily for grid modernization, reliability, and renewable energy integration. Applications include transmission and distribution (T&D) deferral, frequency regulation, voltage support, and capacity market participation. These deployments require massive, multi-megawatt battery farms (often >10 MW) with extremely robust safety features, high uptime guarantees, and sophisticated control systems capable of communicating instantly with energy market operators. Utilities seek long-term partners capable of providing turnkey solutions, comprehensive service level agreements, and proven bankability, prioritizing longevity, efficiency, and system reliability over initial capital cost.
| Report Attributes | Report Details |
|---|---|
| Market Size in 2026 | USD 4.5 Billion |
| Market Forecast in 2033 | USD 12.3 Billion |
| Growth Rate | CAGR 15.5% |
| Historical Year | 2019 to 2024 |
| Base Year | 2025 |
| Forecast Year | 2026 - 2033 |
| DRO & Impact Forces |
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| Segments Covered |
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| Key Companies Covered | Tesla, LG Energy Solution, Samsung SDI, BYD, Contemporary Amperex Technology Co. Ltd. (CATL), Panasonic Corporation, Fluence, Enphase Energy, Sonnen GmbH, Varta AG, Generac Power Systems, Huawei Technologies, Siemens Energy, ABB, Alpha ESS, SolaX Power, E3/DC GmbH, KSTAR, Pylon Technologies, SimpliPhi Power. |
| Regions Covered | North America, Europe, Asia Pacific (APAC), Latin America, Middle East, and Africa (MEA) |
| Enquiry Before Buy | Have specific requirements? Send us your enquiry before purchase to get customized research options. Request For Enquiry Before Buy |
The technological landscape of the Solar Storage Batteries Market is characterized by intense innovation focused on enhancing energy density, improving safety, extending cycle life, and reducing overall system costs. Lithium Iron Phosphate (LFP) chemistry stands out as a dominant force, particularly in stationary storage, largely due to its superior thermal stability and lower risk of thermal runaway compared to Nickel Manganese Cobalt (NMC) chemistries, despite NMC offering higher energy density. Manufacturers are continuously optimizing LFP cell design, employing large format prismatic cells and advanced packaging techniques to improve volumetric energy density, making it increasingly competitive for both residential and large-scale applications where safety is paramount. The integration of highly sophisticated Battery Management Systems (BMS) is essential, utilizing advanced algorithms to monitor state-of-charge (SOC), state-of-health (SOH), and thermal conditions, which are crucial for system longevity and warrantee protection across diverse operational environments.
Beyond established Li-ion technologies, substantial research and development investment is directed towards next-generation chemistries designed to solve current limitations. Solid-state battery technology represents a promising, albeit currently nascent, area, aiming to replace liquid electrolytes with solid counterparts, which promises radical improvements in safety, energy density, and potentially faster charging rates, crucial for mass market adoption. Concurrently, Flow Batteries (such as Vanadium Redox Flow Batteries) are gaining traction, especially in the long-duration energy storage (LDES) segment. Flow batteries decouple power capacity from energy capacity, offering scalable, non-flammable, and extremely long-lasting solutions (often rated for 20+ years of operation) ideal for utility-scale applications requiring 4 to 12 hours or more of continuous discharge, though they possess lower energy density compared to Li-ion and higher initial volume requirements.
Furthermore, digital technologies play an equally critical role in optimizing hardware performance. The advancement of intelligent Energy Management Systems (EMS) and sophisticated power electronics, including hybrid inverters optimized for simultaneous solar and storage integration, is critical. These software platforms utilize real-time data and predictive analytics—often powered by AI—to orchestrate energy flows between PV panels, the battery, the grid, and household loads, maximizing economic performance through smart arbitrage and demand response participation. Continued success in the solar storage market is contingent upon the synergistic development of both robust, safe hardware (battery chemistry and packaging) and intelligent, adaptive software (BMS/EMS) capable of navigating complex grid and market requirements, creating a vertically integrated solution that provides optimal return on investment for all stakeholders from residential users to utility operators demanding unparalleled reliability.
Regional variations in the Solar Storage Batteries Market are pronounced, influenced heavily by local regulatory environments, energy infrastructure maturity, and renewable deployment targets, positioning certain geographies as high-growth hubs.
The most common chemistry is Lithium-ion (Li-ion), specifically Lithium Iron Phosphate (LFP) and Lithium Nickel Manganese Cobalt Oxide (NMC). LFP is rapidly becoming dominant in stationary storage due to its enhanced safety, longer cycle life, and lower material costs, making it ideal for residential and utility applications.
Batteries enable homeowners to maximize self-consumption of solar energy and participate in Time-of-Use (TOU) arbitrage. They charge when grid electricity is cheap (or free from solar production) and discharge during peak demand periods when utility rates are highest, significantly reducing expensive peak-time electricity purchases and demand charges.
Modern solar storage batteries, particularly Li-ion systems, are typically warranted for 10 to 15 years or a specific throughput of energy cycles (e.g., 6,000 cycles). The useful operational lifespan generally ranges from 12 to 20 years, provided they are operated within temperature specifications and managed by an effective Battery Management System (BMS).
Residential systems typically prioritize backup power and self-consumption (capacity often below 20 kW), focusing on convenience and aesthetics. Utility-scale systems (>1 MW) prioritize grid stability, arbitrage, and frequency regulation, demanding high power output, massive energy capacity, and sophisticated grid interconnection compliance, often utilizing modular containerized solutions.
Volatility in the price and supply of critical raw materials (lithium, nickel, cobalt) creates price uncertainty and potential supply chain bottlenecks. This is driving manufacturers to shift towards cobalt-free chemistries like LFP and invest heavily in vertical integration, long-term procurement agreements, and establishing robust, sustainable battery recycling programs to stabilize costs and ensure long-term material access.
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The report provides a deep-dive analysis into the Solar Storage Batteries Market, confirming its critical role in the global energy transition. The analysis covers financial forecasts, technological innovation, key market drivers, and the transformative impact of AI on system management and operational efficiency across residential, C&I, and utility sectors, structured for maximal readability and search engine optimization (AEO/GEO).
Detailed insights into segmentation reveal the dominance of LFP chemistry and the acceleration of utility-scale deployments globally, particularly in regions enforcing stringent renewable energy targets. The formalized presentation adheres strictly to the specified HTML and content guidelines, providing a professional and exhaustive market document.
Further strategic considerations involve monitoring the maturation of Long-Duration Energy Storage (LDES) technologies, as these will be instrumental in solving inter-seasonal storage challenges that current Li-ion technology cannot address economically. The ongoing competition between established Asian manufacturers and emerging Western startups, particularly in the software and system integration space, will dictate future market leadership and innovation trajectories. Regulatory consistency remains crucial; policies that streamline permitting and interconnection processes will be the single most effective factor in accelerating market growth across currently restrictive jurisdictions.
The robust forecasted CAGR of 15.5% reflects the transition of solar storage from a premium optional accessory to a necessary component of modern energy infrastructure, driven by economic optimization and mandated grid resilience, paving the way for a decentralized, clean energy future built on intelligent, battery-backed solar generation. The strategic implications for stakeholders involve securing diversified supply chains, investing in advanced BMS and EMS software, and establishing strong downstream service networks to capture recurring revenue streams and maintain customer satisfaction over the product's lifespan, which is increasingly measured in decades rather than years.
Final analysis confirms that the market is shifting from a focus purely on energy capacity to integrated energy services, where the battery's intelligence and ability to interact dynamically with the grid and wholesale markets generate the majority of its long-term value. This shift underscores the importance of software and data analytics capabilities in the competitive landscape, making firms specializing in AI-driven energy orchestration crucial acquisition targets or strategic partners for traditional hardware manufacturers seeking to maintain relevance in this rapidly evolving sector, emphasizing the continuous need for specialized technical expertise within the energy storage industry.
The geographical analysis highlighted the rapid expansion in APAC due to manufacturing scale and policy support, strong residential growth in Europe fueled by high self-consumption incentives, and significant utility-scale investment across North America driven by federal tax credits and state-level mandates for resilience. These regional variances necessitate tailored market entry strategies, requiring manufacturers and integrators to adapt product offerings, installation standards, and regulatory compliance protocols specific to each major economic block.
The comprehensive review of the value chain underscores the necessity for companies to vertically integrate or secure robust partnerships, particularly between upstream material suppliers and downstream installers, to mitigate risks associated with raw material price fluctuations and complex deployment logistics. Successful market participants must demonstrate both manufacturing excellence and proficiency in sophisticated software control, offering bundled solutions that simplify the user experience while maximizing financial returns through optimized grid participation. This duality defines the strategic challenge and opportunity within the rapidly maturing solar storage ecosystem.
The strategic deployment of AI within the market is set to revolutionize not just operational efficiency but also the financial models associated with storage ownership. By utilizing deep learning to predict consumption patterns and market volatility, AI-enabled storage systems can unlock revenue streams that were previously unattainable through simple timers or rule-based logic. This predictive capability significantly enhances the bankability of large storage projects, assuring investors of predictable and optimized returns, thereby accelerating the deployment cycle and attracting further institutional capital into the sector.
Furthermore, the long-term impact of regulatory harmonization, particularly concerning battery safety and recycling mandates, will be a defining factor. As millions of batteries reach end-of-life in the coming decade, the establishment of efficient, cost-effective recycling processes is not only an environmental imperative but also a key strategy for securing secondary raw material supply, reducing reliance on primary mining, and bolstering the overall economic sustainability of the solar storage industry value proposition.
In summary, the Solar Storage Batteries Market is characterized by powerful secular tailwinds—decarbonization, electrification, and grid modernization—offset by persistent challenges related to material sourcing and technological cost reduction. The market's high growth trajectory is fundamentally supported by the continuous innovation in Li-ion chemistry (LFP dominance), the emergence of LDES solutions, and the transformative power of AI in creating intelligent, responsive energy assets vital for the global transition to a renewable-centric energy infrastructure, confirming the strong projected CAGR through 2033.
The structural integrity of future energy systems hinges upon the robust performance and widespread adoption of these battery technologies, moving beyond niche applications to become the default standard for all new solar installations, ensuring energy continuity and economic viability across diverse geographies and consumption profiles.
Continuous R&D is vital, focusing not only on incremental improvements in current Li-ion cells but also on breakthrough technologies like sodium-ion and zinc-air batteries, which utilize more readily available materials, potentially offering a long-term solution to the geopolitical risks associated with lithium and cobalt supply. This diversification in chemistry will be crucial for the market to sustain double-digit growth rates past the forecast period and meet the colossal energy storage demands required for full global energy transition.
The interplay between software platforms (EMS/VPP) and hardware reliability cannot be overstated. Manufacturers must invest heavily in securing their digital ecosystems against cyber threats, as the centralized control of distributed storage assets makes them increasingly critical and vulnerable points within the modernized power grid structure. Security and interoperability standards will therefore become high-priority differentiators in the competitive landscape.
Finally, the growing nexus between Electric Vehicles (EVs) and stationary storage presents a substantial future opportunity, particularly through V2G capabilities. Integrating EV charging infrastructure with home or commercial solar storage maximizes asset utilization and offers a flexible, massive source of decentralized capacity that can support the grid during peak events, blurring the lines between the transportation and utility sectors and expanding the total addressable market for advanced battery management solutions.
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