The United States battery storage market is expected to continue growing at an unprecedented rate, as energy operators aim to ensure a more stable flow of electricity from renewable energy projects. This will support a decrease in reliance on some fossil fuels, particularly coal.
After a record-breaking 2025, several states are expected to continue investing heavily in utility-scale battery storage to boost their energy security and diversify the energy mix, following on from Biden-era plans for the future of U.S. energy.
Rapid Growth
The rapid rollout of battery storage is set to continue for at least the next two years in the United States, as the share of renewable energy continues to grow and coal production shrinks. The Energy Information Administration’s (EIA) latest short-term outlook estimates that U.S. electricity production will grow by 170 million megawatt-hours (MWh), or around 4%, by the end of 2027.
The rise in electricity generation is expected to be driven largely by renewable energy sources, such as solar power. The EIA predicts that utility-scale wind, solar, and hydropower will grow by 201 million MWh through 2027, increasing their market share to 27%. And, to ensure the new power supply is reliable, operators are investing heavily in battery storage.
The ACP Senior Vice President of Markets and Policy Analysis, John Hensley, stated, “Strong growth in the U.S. energy storage market reflects a simple reality: meeting rising demand and keeping the grid reliable increasingly requires storage.” Hensley added, “These installations deliver the flexible, reliable grid support America needs today, boosting reliability and keeping power bills in check.”
Texas and California Dominate
Texas and California are expected to continue dominating in terms of solar energy production, as well as in the deployment of utility-scale battery storage. In these two states, the batteries already installed are mainly charged during the day by solar resources, to store and provide energy in peak hours when the sun is no longer shining. Using batteries makes renewable energy sources more stable, helping to reduce reliance on fossil fuels and drive down energy prices.
At present, Texas and California contribute over two-thirds of the total installed battery storage across the country, although this figure is expected to shift as other states invest more heavily in batteries. There are currently only five states that have over 1 GW of installed battery storage capacity, with Arizona, Nevada, and New Mexico making up the remaining three. However, the EIA expects the number of states with more than 1 GW of storage to rise to 12 by 2030.
By 2024, the growth in California’s battery storage had helped to displace some natural gas use during peak evening hours. Meanwhile, in Texas, batteries have helped mitigate summertime grid emergencies over the last two years.
Record-Breaking Year for Battery Storage
The U.S. installed more battery storage in 2025 than in any year previously, despite a push from the Trump administration to ditch renewable energy plans to focus, instead, on boosting fossil fuel output.
U.S. battery storage additions in 2025 reached 57.6 GWh of new capacity, marking a 30% increase over 2024. The utility-scale segment dominated this growth, contributing almost 50 GWh of the total. Residential storage also increased by 51% year over year. Over the next five years, the U.S. is expected to install almost 67 GW of new utility-scale battery capacity, or over 600 GWh, increasing its battery capacity by around threefold from now.
In 2025, Nevada deployed around 1.4 GW of new battery storage capacity, with the completion of Primergy’s Gemini Solar project increasing the state’s total battery storage capacity to over 5.3 GWh. It is estimated that 1 GWh can provide enough energy to power between 250,000 and 600,000 homes, based on typical energy consumption.
While the Trump administration cut huge quantities of solar and wind energy funding, President Trump’s One Big Beautiful Bill Act left incentives for battery storage largely untouched, which means several plans for boosting battery storage remain in place.
Small-Scale Solar Growth
The U.S. small-scale solar market has grown rapidly over the last decade, with output doubling since 2020, to contribute around 2% of total U.S. electricity generation. Some states have experienced more rapid deployment of small-scale solar than others. Small-scale solar power now contributes over 10% of power generation in four states – Massachusetts (16%), Hawaii (15.1%), California (14.5%), and Vermont (10.3%).
Battery storage in U.S. homes rose by 64% in 2024, compared to 2023, outpacing increases in commercial and utility installations, according to data from Wood. By March 2025, battery storage units were in use at roughly half a million U.S. homes. The residential storage market expanded for its sixth consecutive quarter in Q3 2025, with California, Arizona, and Illinois dominating deployment.
As several states look to diversify their energy mix, battery storage is expected to play a major role in strengthening U.S. energy security in the coming years. Despite attacks on solar and wind power by the Trump administration, battery energy storage has become key to making renewable energy projects more reliable and reducing reliance on fossil fuels. Therefore, several state governments are expected to continue investing heavily in the sector.
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