Global battery energy storage system (BESS) capacity is set to skyrocket at a 42% compound annual growth rate through 2030, fueled by booming electrification, industrial and data center demand, declining lithium-ion battery costs and maturing supply chains, according to GlobalData’s latest report Strategic Intelligence: Batteries in Power (2026).
China and the United States dominate the global storage market, jointly accounting for 74.6% of the world’s installed BESS capacity by the end of 2025. The US market has witnessed explosive growth, closing 2025 with a record 57.6 GWh of new storage additions, lifting its cumulative grid-scale storage capacity to 137 GWh. The strong growth momentum has continued into 2026, with US first-quarter installations hitting 9.7 GWh, marking a 32% year-over-year increase and the highest Q1 figure on record for the country’s storage sector.
Utility-scale front-of-the-meter projects lead the US domestic market, occupying over 75% of total installation volume, with 7.8 GWh deployed in the first quarter of 2026 alone. Per the US Energy Information Administration’s projection, 24 GW of utility-scale batteries will come online in 2026, with deployments heavily concentrated in Texas (53%), California (14%) and Arizona (13%).
A notable industry-wide shift is underway from two-hour to four-hour battery storage systems. As solar and wind penetration rises, the daily gap between power generation and demand has widened, making four-hour systems more valuable for shifting surplus midday solar power to evening peak demand periods. Regulators worldwide are increasingly recognizing this upgrade, with four-hour duration becoming the new baseline for capacity credit and resource adequacy assessments.
“Energy shifting has become the fulcrum of the battery storage value proposition, recasting batteries from ancillary grid-support tools into system-critical infrastructure,” said Rehaan Shiledar, Power Analyst at GlobalData. California has standardized four-hour storage systems via public utility programs, while similar trends are emerging globally. UK projects are shifting focus from frequency response to energy shifting, and Middle Eastern tenders are prioritizing multi-hour storage to dispatch solar power during evening peak hours.
