The energy storage industry has achieved an incredible feat, surpassing its ambitious goals set nearly a decade ago. Back then, the market was just taking its first steps, and an industry organization dreamed big, aiming for 35 gigawatts of grid-connected batteries by 2025. Fast forward to today, and we've witnessed an extraordinary transformation. In just the third quarter alone, a whopping 4.7 gigawatts of batteries were installed, and the year isn't even over yet! The total deployment has already exceeded 40 gigawatts, according to Canary Media. This remarkable growth has propelled energy storage from a minor player to one of the largest sources of new power on the U.S. grid in a mere eight years.
But here's where it gets even more impressive: this achievement accounts for nearly half of all new renewable power deployed on the grid during July to September. And this year, renewables have taken the lead as the primary source of new capacity, as reported by the Federal Energy Regulatory Commission.
Much of this new storage capacity has been strategically deployed in Arizona, California, and Texas, states that have experienced grid strain in recent years. Experts believe that the lessons learned from these regions can be invaluable for other areas, such as the Midwest and East Coast, which are facing challenges due to the surge in data center construction.
Startups have been at the forefront of this revolution, recognizing the immense potential. Take Redwood Materials, co-founded by Tesla veteran JB Straubel, which has expanded its business to repurpose used EV batteries for grid-scale storage. The company identified a unique opportunity where batteries arriving at their recycling facilities still had significant life left, coinciding with the rapid growth of the battery storage industry. By 2028, Redwood aims to deploy an impressive 20 gigawatt-hours of battery storage, a goal that has garnered support from investors, who have pumped an additional $350 million into the company to propel this new venture.
Another startup, Base Power, has adopted a different approach, leasing batteries to homeowners and aggregating them to create a large virtual power plant. Based in Austin, this innovative company raised a staggering $1 billion in October to build a battery factory and expand beyond Texas. To date, Base Power has deployed over 100 megawatt-hours of batteries in the Lone Star State.
While lithium-ion batteries have dominated new installations, other startups are exploring alternative technologies that could significantly reduce storage costs. Sizable Energy, for instance, is pioneering a novel method to store power in flexible reservoirs floating in the open ocean. Fourth Power is utilizing blocks of carbon to store heat at super-high temperatures, aiming for deployment in 2028 at a cost lower than lithium-ion batteries or natural gas power plants. XL Batteries is implementing its flow-battery technology at petrochemical storage sites, enabling the storage of hundreds of megawatt-hours using existing infrastructure. Cache Energy has developed inexpensive pellets of calcium hydroxide that can store energy for months with minimal losses.
The collective efforts of these startups and the industry as a whole point to an exponential expansion. When paired with solar and wind, which remain the most cost-effective forms of new electricity, energy storage has the power to revolutionize global energy markets and reshape the U.S. grid.
Tim De Chant, a senior climate reporter at TechCrunch, has a rich background in journalism, having written for publications like Wired magazine, the Chicago Tribune, Ars Technica, The Wire China, and NOVA Next, where he was a founding editor. De Chant is also a lecturer in MIT's Graduate Program in Science Writing and was awarded a Knight Science Journalism Fellowship at MIT in 2018, where he studied climate technologies and explored new business models for journalism. He holds a PhD in environmental science, policy, and management from the University of California, Berkeley, and a BA in environmental studies, English, and biology from St. Olaf College.
You can reach out to Tim by emailing tim.dechant@techcrunch.com.
