The U.S. power storage market hit a document 18.9 GW of battery power storage system (BESS) installations in 2025, a 52% enhance over 2024, in line with the most recent “U.S. Energy Storage Monitor” report launched right this moment by the American Clean Power Association (ACP) and trade analyst Wood Mackenzie.
A photo voltaic + storage challenge in Arizona within the means of including BESS. Credit score: McCarthy Constructing Corporations
In This fall 2025 alone, 5.8 GW was put in. Utility-scale installations accounted for 4.9 GW of that whole, a 31% enhance over the earlier 12 months. New exercise was unfold throughout 13 completely different states, exhibiting a market enhance outdoors of main states California and Texas.
The U.S. residential storage market additionally hit a quarterly milestone in This fall with 1 GWh put in as tax incentive expiration dates accelerated demand. The residential market put in a complete of greater than 800 MW in 2025, a 75% year-over-year enhance. California led in progress, putting in 700 MW extra in 2025 than it did in 2024, pushed by excessive retail electrical energy charges and a web billing tariff incentivizing battery discharge throughout peak power utilization hours. Puerto Rico, Texas, Arizona, and Illinois rounded out the highest 5 markets for storage progress in 2025.
The group, business and industrial (C&I) market additionally noticed document progress with 77 MW put in in This fall 2025 as state insurance policies boosted deployments.
“The record-breaking power storage progress seen in 2025 highlights how know-how innovation is reworking America’s grid,” stated John Hensley, senior VP of markets and coverage evaluation at ACP. “This momentum, pushed by supportive coverage and increasing market alternatives, demonstrates that large-scale storage is now a cornerstone of delivering inexpensive, dependable and American-made power in communities nationwide. Continued collaboration throughout trade and authorities will probably be important to constructing on this progress and assembly hovering power demand.”
U.S. Installations to surpass 28 GW by 2031 throughout all segments
Wooden Mackenzie expects this momentum within the BESS market will proceed. The report predicts that the U.S. will set up half a terawatt-hour of storage between 2026 to 2031, a 250% enhance over the earlier five-year interval. Utility deployment is predicted to guide that effort, which is predicted to double between 2025 and 2030 in gigawatt-hours put in.
A record-breaking variety of initiatives began development in 2025 to lock within the earlier federal funding tax credit score (ITC) necessities. Demand for residential storage rose in 2025 as customers took benefit of the expiring Part 25D ITC, however the residential market is predicted to contract by 2% in 2026 with the expiration of the tax credit score, in line with the report. Annual C&I storage installations are additionally anticipated to develop by 39% between 2025 and 2030 as system prices decline and doable coverage help increase worthwhile enterprise instances.
“2025 was a banner 12 months for the power storage market,” stated Allison Feeney, analysis analyst at Wooden Mackenzie. “Declining system prices, supportive insurance policies and rising income alternatives have all contributed to the spectacular progress over the past six years. We count on this momentum to proceed because the know-how turns into much more confirmed and extensively adopted.”
Regulatory uncertainty and variable demand progress situations
Wooden Mackenzie assessed high-case and low-case five-year outlook situations for BESS within the report. The high-case would lead to roughly 36 GW of latest BESS deployed in 2031, if increased demand progress, federal allowing aid and storage applied sciences retain entry to tax credit and enhance home system and cell provide in mild of Overseas Entity of Concern necessities.
Nonetheless, the low case leads to 17% much less capability than the bottom case.
“The market trajectory is strongly upward, however massive load buildout and federal coverage will decide whether or not we attain the excessive case of 26 GW by 2031 or one thing extra conservative,” stated Allison Weis, world head of storage at Wooden Mackenzie.
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