Large-scale energy storage has moved from a novel pilot technology to a central pillar of modern infrastructure for the U.S. energy grid. Join us as we discuss four key economic advantages this technology affords & why it’s positioned for growth.
Contact: Betsy Barry
Communication Manager
706.206.7271
betsy.barry@acculonenergy.com
As the United States energy grid undergoes its most significant transformation in decades, large-scale energy storage has moved from a novel pilot technology to a central pillar of modern infrastructure. But what exactly is it, and why is it positioned for growth in 2026?
What is Large-Scale Energy Storage?
At its simplest, a Battery Energy Storage System (BESS) collects electrical energy from the grid or renewable sources like solar, stores it, and discharges it later when it is needed most.
However, viewing it merely as a backup tank is outdated. Industry experts now refer to BESS as a grid “multi-tool” because it takes advantage of unused capacity in the system. Rather than building massive power plants that sit idle for parts of the day, batteries act as a flexible buffer, smoothing out supply and demand while stabilizing the frequency and voltage of the grid.
With operational large-scale storage in the U.S. surpassing 38 gigawatts in 2025, the technology is no longer theoretical: it is an economic driver.
Here are some of the biggest economic advantages driving its growth:
Economic Advantage 1: Superior Cost Competitiveness
For decades, utilities relied on natural gas “peaker” plants, which were designed to start up quickly and run only during periods of peak electricity demand to help meet short-term surges in power use. In 2026, batteries have largely won the economic argument against their natural gas counterparts.
The cost of battery storage has dropped precipitously, with stationary storage pack prices falling 45% in a single year to a record low of $70/kWh. Lazard’s 2025 Levelized Cost of Energy report found that 4-hour subsidized battery storage is now usually cheaper than building new gas peaker plants.
Furthermore, batteries offer speed and certainty that gas cannot. While gas turbines currently face shortages that push delivery timelines out to 2029, battery projects can be deployed in an average of 1.69 years. Speaking of certainty, gas peaker plants are susceptible to significant reliability issues during extreme weather events like ice storms because they are vulnerable to equipment freezing and fuel supply disruptions when pipeline networks fail. These plants can also underperform during summer heatwaves due to temperature stress and are susceptible to being hamstrung by droughts if they rely on water-dependent cooling systems. In fact, battery systems are already being deployed with peaker plants to reduce operating costs, which will only increase in the future, especially as extreme weather events become more commonplace and continue to expose the vulnerability of gas infrastructure.
As the transition to reliable energy accelerates, & the need to shore up the grid remains critical, large-scale battery storage stands out not just as a technical innovation but as a compelling economic solution.
Economic Advantage 2: Deferred Infrastructure Investment (“Non-Wires Alternatives”)
One of the costliest aspects of the energy transition is upgrading transmission lines and substations to handle new loads. Large-scale storage offers a cheaper “non-wires alternative.” By placing batteries strategically at substations or high-demand commercial sites (a practice known as distributed capacity procurement), utilities can relieve congestion on specific grid nodes. This allows for the deferral (or elimination) of the need for more expensive and involved physical infrastructure upgrades.
This capability is particularly critical on the distribution network, where increasing EV penetration can cause localized demand to exceed the ratings of installed transformers. Replacing this equipment is financially burdensome and logistically difficult, as a global shortage of high-voltage transformers has led to production slowdowns and long lead times. Rather than waiting years for new hardware, utilities can deploy battery systems to absorb load spikes, preventing transformer overload and ensuring grid reliability, all while avoiding steep capital expenditure construction and creating a primary economic driver for utilities in the process.
Economic Advantage 3: Monetizing Volatility and Reducing Curtailment
In markets heavily saturated with solar power, like California and Texas, electricity prices often drop to zero (or negative) during the day when the sun is shining, only to spike in the evening. Without energy storage capacity, this excess clean energy is wasted.
Energy storage systems solve this economic inefficiency through arbitrage: buying power when it is cheap (or negatively priced) and selling it when prices are high. This capability essentially lowers curtailment rates and increases the utilization of renewable assets.
This dynamic is creating new financial instruments, such as “Hybrid PPAs” (Power Purchase Agreements), where developers bundle solar generation with energy storage flexibility to hedge against price volatility, ensuring stable revenue streams even in erratic markets.
Economic Advantage 4: Consumer Savings and Rate Stabilization
Finally, large-scale energy storage acts as a shock absorber for consumer energy bills. By injecting power into the grid during extreme weather events or peak heat/cold days, batteries prevent the astronomical price spikes that occur when supply gets tight.
A clear example of this occurred in Texas, where the addition of 5 GW of energy storage contributed to $750 million in energy cost reductions for ratepayers in a single year. Additionally, for large commercial users, on-site storage provides “peak-load management,” drastically reducing the heavy demand charges utilities levy during peak usage hours.
As the transition to reliable energy accelerates, and the need to shore up the grid remains critical, large-scale battery storage stands out not just as a technical innovation but as a compelling economic solution. Although we are just at the precipice of scaling and cost-effectiveness of large-scale energy storage, the ongoing decline in battery prices and supportive policies suggest that grid-scale storage will play an increasingly central role in shaping a resilient and efficient energy landscape not only in 2026, but for years to come.