The U.S. battery energy storage system (BESS) market grew by 60% in 2024 and is projected to accelerate further through 2026, according to energy research firm Rystad Energy, despite indications of waning federal support for renewable energy.
Installations increased from 6 gigawatts (GW) in 2023 to 10 GW in 2024, and are expected to reach an annual installation rate of 16 GW by early 2026. The expansion is being driven by declining battery costs and growing demand for grid stability amid extreme weather and rising electricity loads.
Texas surpassed California last year as the country’s largest BESS market, with 4 GW of installed capacity and an additional 7 GW in inventory, suggesting further near-term growth. Arizona is leading deployment among emerging markets, as total national inventory more than doubled over the past year to 7 GW.
“Whether it is theoretically possible to have all renewable plus BESS systems in CAISO… remains to be seen,” said Artem Abramov, head of new energies at Rystad Energy, referring to the California Independent System Operator, which oversees most of the state’s grid.
California remains a key player in the sector, with batteries now supplying 13% of power demand during discharge hours and contributing up to 30% at peak times, according to Rystad. The state has also made significant progress in renewable energy integration, with clean sources now meeting more than 40% of annual demand, up from 30% in 2021. Over the same period, reliance on imported power has declined from 27% to 16%.
The figures underscore how battery storage is playing an increasingly central role in U.S. energy infrastructure, even amid questions over the future pace of federal policy support for renewables.
