Thought bubble: Battery projects shine amid solar concerns
Illustration: Aïda Amer/Axios
Big battery projects that can store energy for a constrained grid are emerging as a bright spot amid solar challenges at an industry conference this week.
Why it matters: With favorable tax credits remaining intact and rising demand from data centers, energy storage is on a hot streak this year.
Zoom in: Companies at the RE+ conference in Las Vegas this week unveiled bigger battery storage products, with many hoping to attract data centers and industrial customers.
- Tesla launched the Megablock, a bunch of batteries (20 MWh) paired with a transformer, enabling developers to deploy big storage projects faster.
- Solar companies like Trinasolar and Canadian Solar showed off utility-scale products. Expanding into storage helps them diversify and find growing revenue, amid fears of a solar slowdown because of expired tax credits.
- Others, like Fluence, showed off energy storage systems with supply chains sourced in the U.S. The move helps tap into more tax incentives and avoid global trade disruptions.
By the numbers: Batteries accounted for 23% of new grid capacity installed in the U.S. last year, while gas plants provided just 4% of new capacity.
- The U.S. market is expected to install 18 GW of batteries this year, up from 13 GW last year.
The big picture: Unlike solar and wind, which are seeing tax credits phased out, grid energy storage projects can tap into tax credits for much longer.
- Data center developers are also looking to battery projects as a way to get more capacity for data center projects, paired with clean energy and built more quickly than other assets.
Yes, but: There are still concerns over the safety of older energy storage projects, as battery incidents can be catastrophic.
- Some companies showed off enhanced safety control systems for battery projects.
The bottom line: As the solar sector faces the roller coaster of lost tax incentives, battery storage systems are emerging as the new hot product.
