In any other year, May 14 may well have been an energy disaster in Texas.
Temperatures climbed to seasonal levels not seen in over a century: 92F in Dallas, 95F in Houston and 104F in Laredo. Air conditioners hummed en masse and power demand surged. Meanwhile, scores of natural-gas powered generators were offline, getting tuned up for summer.
But Texas skies were pretty sunny and windy and startups had spent the preceding months building big banks of batteries to store electricity. When power demand peaked around 4:30 in the afternoon, almost half of the electricity on the grid was coming from renewables, according to the energy analytics platform GridStatus.IO. As the sun set, battery banks that had been soaking up electrons in the heat of the day stepped up to cover 8% of demand, keeping power flowing.
“Batteries are very good at handling these types of events,” said Andrew Gilligan, director of commercial strategy at Fluence Energy Inc., a battery developer with three storage sites in Texas. “Things have gotten a lot better than a couple years ago.”
This summer will be an energy doozy in the US as climate change exacerbates heat waves and a rash of new data centers and crypto mines come online. But these new power vacuums arrive in concert with a stack of big batteries. America, particularly its Sun Belt, has been a gusher of renewable energy for years; now, utilities will be able to bottle up much of that sun and wind and discharge it around the clock.
In the 12 months through April – the most recent data available – energy storage in the US surged from roughly 18 gigawatts to 25 gigawatts, a 41% increase, according to a Bloomberg Green analysis of federal data. In Arizona, battery bandwidth nearly tripled; in Texas, it has almost doubled. In the evening of April 8, more than 11% of Texas electricity was coming from batteries, a new record.
If the US is able to reach the Biden Administration’s goal of emissions-free electricity by 2035 – or even get close – batteries will be a big reason why. Renewable electricity is setting records every few days and comprised almost one-third of all US power generation in March. Batteries can make sure those electrons hit at the most opportune time – or at least that they don’t go to waste. Along the way, they’ll drag electricity prices down, speed the retirement of fossil fuel plants and preclude plans for new ones, according to Jan Rosenow, head of the energy program at Oxford University’s Environmental Change Institute.
“Twenty years ago, the main problem with renewables was that they were so expensive,” Rosenow explained. “Now, renewables are cheap, but we need to be able to match that supply to demand. For that, battery storage is clearly one of the best tools in the box.”
104 million Face Outages
Summer is always a fraught time for grids and utilities. Cooling takes more electricity than heating and with a fast-changing climate, Americans are doing it more and more. Annual cooling degree days, an indicator of AC use, have increased 17% compared with the 1990-1999 average, according to BloombergNEF. Last summer was the fourth hottest on record in North America and meteorologists are forecasting a similarly sweaty sequel.
“An increase in heat extremes is the most obvious symptom of climate change,” Karen McKinnon, a professor who studies the statistics behind climate change at University of California at Los Angeles. “Even seemingly small changes in temperatures of a few degrees can make summers feel substantially more extreme.”
As a result, three of the continent’s six major power grids are at risk of power outages this summer, according to the North American Electric Reliability Corp. (NERC), a Washington D.C.-based nonprofit. All told 104 million Americans – roughly one in three people – live in areas where extreme heat and rising demand could shut out the lights, though NERC says the risk would be far higher without the new banks of batteries.
In Texas, for example, NERC’s odds of an energy emergency this summer have dropped from roughly 15% a few months ago to 3.6% thanks to battery capacity. Meanwhile, NERC expects batteries to juice roughly one-quarter of California’s peak power demand in coming months.
“Reliability is the ability to react to sudden changes in the grid,” explained Chris McKissack, chief executive officer of Fullmark Energy, which is building two storage sites in Texas. “And when it comes to reacting, nothing moves faster than battery storage.”
Homeowners have realized as much, adding their own small battery systems to keep the lights on and avoid time-of-use electric price peaks. Last year, residential storage surged by 64%, systems that also help lower summer demand peaks and stabilize the grid.
Last summer, there were no major power outages in the US, a success the Department of Energy primarily attributed to new solar generation and storage.
Officials who run the Texas grid say batteries have also been critical in lowering prices, particularly in the summer. They expect storage in the state to triple over the next five years.
Where Solar Was 10 Years Ago
To be sure, it’s still very early days for storage. In 2024, it represented just 2% of US power capacity, but that’s ramping quickly. BNEF expects utility-scale battery storage to nearly double again this year regardless of how much the Trump administration manages to dial down green incentives, with some 18 gigawatts of new capacity.
Utilities and developers are building battery stacks because they are often the most affordable way to add capacity, essentially by stretching power generation that’s already built. The average price for stationary storage systems in 2024 was $125 per kWh, 19% lower than in 2023, according to BNEF.
Storage systems are also getting more resilient. A decade ago, industrial batteries generally discharged all of their electrons in 30-minutes or less. Today, the average system can put out energy for four hours straight, and some are tuned for cycles as high as eight hours. This means, they can kick in more frequently and stay on for longer, not just during brief windows in the morning and evening.
Rosenow, at Oxford’s Environmental Change Institute, says big batteries are surging and affordable enough that their adoption will steepen quickly.
“Storage is now where solar was maybe 10 years ago,” Rosenow explained. “That’s kind of how it feels to me. It’s really mind-blowing.”
As the battery blitz evolves, Rosenow says, people will pay less for electricity, outages will abate and the largest energy hogs, including AI data centers, will spool up with minimal added emissions. But there are diminishing returns.
Storage systems thrive on being able to sock in electrons when they are cheap and sell them when power prices surge. As storage capacity ramps up, those arbitrage opportunities narrow. McKissack at Fullmark says battery executives are becoming much more strategic about what they build and where.
“The race for quantity is over,” he explained. “At this point, very few of us want to bolster up the number of dots on a map.”
What’s more, recent federal tariffs will likely raise the cost of big battery projects from 12% to 50%, depending on how high the levies go and how long they stay elevated, according to Woods Mackenzie. And while American battery factories are booting up, it will be a long time before domestic supply meets even more than a small fraction of US demand, the company says.
Trump’s spending plan also threatens to throttle big batteries and green energy projects. Sabah Bayatli, chief executive officer of solar and battery developer OCI Industries, traveled to Washington DC this week to encourage senators to maintain Inflation Reduction Act incentives or, at the very least, step them down gradually.
“If [the ‘big, beautiful bill’] passes as is, it’s an overnight kill for the solar industry,” he said.
Bayatli may more easily make his case after a summer of heat-wave drama and power outages, but the solar and storage that’s already been built could preclude all that.
McKissack at Fullmark concedes that most people and businesses won’t realize how big of a part renewables and batteries will play in keeping the grid healthy in coming months. Charts of disaster averted because of them aren’t all that powerful, he explained.
“It’s almost easier to talk about when there’s a blackout, but then people’s lives are at risk,” he said.
Lead photo: Power transmission lines near Austin, Texas, US, on Thursday, June 13, 2024. The Texas grid repeatedly has suffered from tight electricity supplies in the past two years as extreme weather and surging power demand stress aging infrastructure.
Copyright 2025 Bloomberg.
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