The U.S. and China held a combined 74.6% share of installed global battery energy storage system (BESS) capacity at the end of 2025, according to a report from GlobalData titled “Strategic Intelligence: Batteries in Power (2026)”. High-volume deployment across both nations is propelled by supportive regulatory frameworks, falling lithium-ion battery costs, stronger supply chains, and clean energy mandates.
Rapidly growing electricity consumption from industrial electrification and data centers is accelerating overall capacity requirements. At the same time, expanding solar and wind generation increases daily grid variability and curtailment, making energy storage assets critical tools for balancing power networks.
The U.S. market closed 2025 with a record-setting 57.6 GWh of new storage additions, bringing total cumulative grid-scale capacity to 137 GWh. Market momentum has accelerated into 2026, with first-quarter installations reaching 9.7 GWh, representing a 32% year-over-year increase and marking the largest first quarter on record for the domestic sector.
Front-of-the-meter utility-scale projects represent over 75% of domestic volume, with developers adding 7.8 GWh in the first quarter of 2026 alone. The U.S. Energy Information Administration projects that developers will bring 24 GW of utility-scale batteries online throughout 2026, with buildouts concentrated heavily in Texas at 53%, California at 14%, and Arizona at 13%.
Behind-the-meter installations continue to evolve as commercial energy users adopt storage to manage facility loads. State-level virtual power plant initiatives in Massachusetts, Texas, Arizona, and Illinois are anchoring local distribution network resilience. Furthermore, automotive EV battery manufacturing facilities across the U.S. are retooling production lines toward stationary storage, pushing domestic battery cell manufacturing capacity toward 120 GWh.
Duration, California, Texas
Across global and U.S. markets, project designs are rapidly standardizing around four-hour duration storage over older two-hour systems. GlobalData Power Analyst Rehaan Shiledar noted that higher shares of wind and solar create longer daily mismatches between generation and load, making multi-hour energy shifting crucial for moving midday solar output into evening peak demand hours.
This is reflected in utility and regulator procurements, which increasingly treat four hours as the baseline threshold for capacity credit and resource adequacy. In California, programs under the California Public Utilities Commission have made four-hour systems the standard. Developers heavily favor co-located solar-plus-storage hybrid plants because sharing a single site and grid connection cuts capital costs and schedule risks.
Co-location also enables export-limited designs where solar capacity is oversized behind a constrained grid tie, allowing excess power to be stored and discharged later without exceeding interconnection caps. Similar duration-lengthening trends are taking root internationally, with UK projects shifting from frequency response toward energy shifting, while Middle Eastern tenders contract multi-hour storage for dispatchable evening solar output.
In Texas, project operators in ERCOT leverage market price volatility by charging batteries during low-cost or negative-price generation hours and discharging during acute net-load spikes. Texas is currently projected to surpass California in total operational storage capacity as utility-scale additions mount.
Data centers
Beyond traditional utility grid applications, battery storage is becoming a core balancing and backup tool for data centers. Systems are moving beyond brief uninterruptible power supply support to actively manage electricity flows between the grid and IT equipment.
Operating with millisecond response times, on-site data center batteries manage sudden voltage or frequency issues and supply instant power during grid switchovers. These deployments allow operators to keep site power use within local connection limits, cover short peak loads, cut demand charges, and bypass grid connection bottlenecks in capacity-constrained zones.
Shiledar highlights that energy shifting has become the leading value proposition for energy storage, recasting batteries from ancillary support tools into system-critical infrastructure. As equipment costs decline and developers monetize stacked revenue streams, energy shifting will remain the central catalyst for global battery storage deployment.
GlobalData’s analysis indicates that a 42% compound annual growth rate through 2030 is anchored by the combined 74.6% market share of the U.S. and China, supported by falling lithium-ion pack prices and expanding production scale. By absorbing surplus renewable output and redeploying it into periods of higher demand, energy shifting will serve as the primary economic driver for global BESS expansion over the remainder of the decade, concluded the report.
This content is protected by copyright and may not be reused. If you want to cooperate with us and would like to reuse some of our content, please contact: [email protected].
Comments
Please login to comment
Tuesday, August 18, 2026
1:00 pm – 2:00 pm EDT, New York City
Tuesday, August 11, 2026
3:00 pm – 4:00 pm CEST, Berlin, Paris, Madrid
Thursday, July 30, 2026
4:00 pm – 5:00 pm CEST, Berlin, Paris, Madrid
Thursday, July 16, 2026
4:00 pm – 5:00 pm CEST, Berlin, Paris, Madrid
The June issue of pv magazine Global is out now!
Available in print and digital – get your copy today!
Thursday, October 7, 2026
11:00 am – 12:30 pm CEST, Berlin, Paris, Madrid
A two-day conference in Austin, Texas, bringing together leaders in US solar manufacturing, equipment specification, and factory execution.
Entries open in seven categories: Modules, Inverters, BoS, BESS, Manufacturing, Sustainability, Projects.
April 01 – August 31, 2026
pv magazine USA hosts its third multi-day virtual event on advancing U.S. solar and energy storage markets, covering financing, supply chains, and distributed energy’s role in grid resilience.
You have no items in your basket.
