The battery energy storage market in the United States is expanding quickly in 2025, continuing strong growth from last year. One major reason for this boom is the ongoing drop in battery manufacturing costs. Analysts at Rystad Energy expect this downward trend to continue for at least five to seven more years as battery technology keeps improving.
Despite some uncertainty about potential changes to tax incentives for renewable energy, the market for grid-scale battery energy storage systems (BESS) remains strong. Rystad Energy forecasts that BESS installations could reach about 16 gigawatts per year by early 2026.
Texas and Arizona are currently leading the nation in battery storage growth. In 2024, Texas passed California to become the top BESS market in the country. Both Texas and California are now installing about four gigawatts of battery storage annually. However, Texas is expanding its capacity faster than California. Over the past year, Texas increased its installed BESS capacity from five gigawatts to more than seven gigawatts.
This trend suggests that Texas is on track to continue its rapid growth in battery storage through 2025, further strengthening its position as a national leader in the clean energy transition.
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