The global energy storage sector is undergoing a rapid transformation, with total installed capacity expected to surpass 4 terawatts by 2040, up from just under 0.5 terawatts in 2024.
According to Rystad Energy's Energy Storage Outlook 2025, this nine-fold increase will be powered primarily by battery energy storage systems (BESS), as renewables continue to reshape the global electricity mix.
Last year marked a new record for BESS growth, with nearly 200 gigawatt-hours (GWh) of capacity added globally—an 80% increase from the previous year.
China led the expansion, contributing more than half of the new additions, while the US, Australia, the UK, and Germany followed.
The report emphasizes that the rise of intermittent renewable sources like solar and wind has amplified the need for flexible storage solutions.
BESS is increasingly seen as a key tool for integrating renewable generation into power grids, mitigating price volatility, and ensuring system reliability.
With the average cost of BESS projects dropping below $300 per kilowatt-hour in 2024, storing electricity has become significantly more affordable.
The levelized storage cost can now fall as low as $60 per megawatt-hour, enabling operators to benefit from intraday power price spreads through arbitrage.
Rystad also highlights the growing role of storage in managing negative electricity prices, which surged in several markets in 2024 due to solar oversupply and low demand.
In this context, battery systems help absorb excess generation and shift renewable power to meet evening peak demand.
California's example is cited as a leading case of successful integration, where utility-scale BESS now routinely covers more than 10% of evening and night-time electricity needs. The state's battery storage capacity has surpassed 12 gigawatts, supporting a broader shift to solar-powered grids.
As solar PV is forecasted to grow more than tenfold by 2050, energy storage is expected to remain a cornerstone of global power sector decarbonization efforts in the years ahead.
By Murat Temizer
Anadolu Agency
energy@aa.com.tr