Battery storage installations in the U.S. are projected to surge to 204 gigawatts by 2035, a dramatic jump from the 31 gigawatts deployed through 2024. Equal to more than 800 gigawatt-hours of capacity, the forecast marks a sharp break from the challenges facing America's green energy segment. Projections from BloombergNEF show battery storage will outperform prior expectations even after the "One Big Beautiful Bill" eliminated numerous tax credits in July. Other renewable energy systems, such as those in which companies like EverGen Infrastructure Corp. (TSX.V: EVGN) (OTCQX: EVGIF) operate, are also scaling up to add impetus to the sector.
The growth in battery storage is crucial for integrating intermittent renewable sources like solar and wind into the grid. As more renewable energy capacity comes online, storage provides the flexibility to dispatch power when the sun isn't shining or the wind isn't blowing. This capability is essential for maintaining grid reliability and reducing dependence on fossil fuels. The U.S. energy storage market has been on a rapid growth trajectory, with record installations in recent years driven by declining battery costs and supportive state policies.
Despite the removal of federal tax credits, analysts expect the momentum to continue due to strong demand from utilities and corporations seeking to meet clean energy targets. BloombergNEF's report highlights that the cost of lithium-ion batteries has fallen by more than 80% over the past decade, making storage projects economically viable even without subsidies. Additionally, the Inflation Reduction Act's extension of the Investment Tax Credit for standalone storage, though later modified, has provided a foundation for long-term investments.
The implications of this growth are far-reaching. Increased energy storage capacity can reduce the need for new natural gas peaker plants, lower electricity costs by storing cheap renewable energy, and enhance grid resilience during extreme weather events. It also supports the electrification of transportation and heating, as more intermittent renewable generation is added to the grid. However, challenges remain, including supply chain constraints, permitting delays, and the need for updated market rules to properly value storage services.
The forecast underscores the resilience of the clean energy transition in the face of policy headwinds. While the elimination of tax credits was a setback, the underlying economics and corporate demand are driving continued adoption. The U.S. is on track to become a global leader in energy storage, with implications for emissions reductions, energy security, and technological innovation. As storage becomes more widespread, it will play a pivotal role in achieving a reliable, affordable, and low-carbon electricity system.
