According to the aforementioned study, the global battery energy storage industry is going to witness unprecedented growth over the period of the next five years, as the installed capacity is set to increase six-fold between the years of 2025 and 2030. The report notes that the accumulated BESS capacity will increase from 224.8 GW in 2025 to around 1,300 GW by 2030, which corresponds to a compound annual growth rate (CAGR) of 42 percent.
This unprecedented pace of growth is associated with such strong trends as the growing demand for electricity due to the electrification of transportation and industrial activities, rapid growth of the artificial intelligence infrastructure, the increasing shares of wind and solar energy, declines in the cost of lithium-ion batteries, better supply chains, and stabilizing governments.
Renewable Energy Integration: The Primary Catalyst
At the center of the battery storage expansion is the global shift to renewable energy. As they reduce their carbon emissions, countries are expanding the role of renewable energy, especially solar energy and wind energy. However, these sources are not always available; sun may not shine, and wind may not blow. Thus, the battery storage offers help to use renewable energy at times of peak demand.
As previously highlighted by the International Energy Agency (IEA), meeting the ambitious targets in terms of solar PV and wind power deployment means that energy storage capacity should increase six times up to 1,500 GW by 2030. IEA's Net Zero Emissions by 2050 scenario assumes that battery storage will account for approximately 90% of the increase in energy storage capacity, rising up to 1,200 GW, fourteen times more than current storage capacity. As GlobalData estimates the energy storage capacity will reach 1,300 GW by 2030, the industry appears to be on track to meet these ambitious targets.
The Shift Toward Longer-Duration Storage
One of the most significant trends reshaping the battery storage landscape is the industry-wide shift from two-hour to four-hour battery systems. As Rehaan Shiledar, Power Analyst at GlobalData, explains: "Higher shares of solar and wind create longer daily mismatches between generation and demand. It makes multi-hour 'shifting', especially moving midday solar into the evening peak, more valuable to reduce curtailment and provide reliable capacity during steep net-load ramps".
This shift is already reflected in utility and regulatory procurement practices worldwide. Under California Public Utilities Commission programmes, most battery projects now feature four-hour duration. Australian state tenders in Victoria and New South Wales specify multi-hour storage to firm renewables, while similar trends are emerging in the United Kingdom as projects pivot from frequency-response toward energy and capacity revenues. Even the Middle East has contracted multi-hour solar-plus-storage projects for dispatchable evening output.
China and the United States: The Undisputed Leaders
As per the forecast period, China and the United States are expected to emerge as the leading BESS markets of the world. The two countries combined accounted for 74.6 percent of the global battery storage capacity at the end of 2025, backed by encouraging regulatory environment, utility-scale procurement initiatives as well as robust renewable energy goals.
The US market has reached a remarkable achievement at the end of 2025 of 57.6 GWh of renewable battery storage. By the end of that year, the cumulative installed grid-scale capacity in the US has ramped up to 137 GWh. The momentum has continued through 2026 with record 9.7 GWh battery installations in the first quarter of the year signifying a 32 percent growth year-on-year increase in the segment. The US Energy Information Administration forecasts utility-scale storage capacity to reach 24GW in 2026 with the major volume taking place in Texas (53 percent), California (14 percent), and Arizona (13 percent).
China's situation is likewise amazing. According to the 2026 Energy Storage Industry Research White Paper issued by the China Energy Storage Alliance (CNESA), it is expected that the total global battery storage installed capacity will increase by 8 to 17 times between 2024 and 2035, from 166 GW to 1414-2885 GW. CNESA predicts that under favorable conditions, China`s total installed storage capacity will be around 450.7 GW by 2030, with an annual growth rate of 25.5 percent for five years.
Co-Located Solar-Plus-Storage: The New Standard
Hybrid renewable energy projects - particularly those combining solar generation with battery storage - are becoming the default configuration for new developments worldwide. By sharing a single site and interconnection point, developers can significantly cut costs and reduce schedule risk. The battery adds revenue by capturing curtailed solar output and shifting delivery into higher-price hours, such as the evening peak.
This co-location model also enables innovative design approaches, including export-limited configurations where PV is oversized behind a constrained grid connection. Excess energy is stored and later discharged without breaching the interconnection limit - a practice already common in California. In Texas, where electricity prices vary widely by location and time, battery storage can monetise this volatility while enhancing system reliability by dynamically charging during low-price periods and discharging when prices spike.
Data Centres: A New Frontier for Battery Storage
The explosive growth of AI infrastructure is creating a new and rapidly expanding market for battery storage. According to GlobalData, BESS is expected to become a main backup and balancing tool for data centres, moving well beyond its traditional role as brief uninterruptible power supply (UPS) support.
Batteries can actively manage power flows between the grid and IT equipment, protecting systems from grid disturbances and on-site power limitations. With response times measured in milliseconds, they can handle sudden voltage or frequency issues and provide instant backup during switchover. Moreover, batteries can help data centres grow faster in grid-constrained regions by keeping power use within connection limits, covering short peak loads, cutting demand charges, and smoothing rapid load changes.
Conclusion: From Grid-Support Tool to System-Critical Infrastructure
As Shiledar correctly states, "Energy shifting has become the fulcrum of the battery storage value proposition, transforming battery technology from support systems for the network into essential infrastructures." The batteries contribute to power grid reliability by taking excess renewable energy, which is then sold in times of peak demand and pricing.
With prices remaining low, supply chains strengthening, and supportive policies boosting deployment, the global battery storage sector is experiencing a period of transformative development. The sixfold increase in capacity by 2030 is not a prediction but rather the core element of the world's transition to sustainable and clean energy.
