The Grid Storage Industry Set a Wild Goal for 2025 — and Then Crushed…

The Grid Storage Revolution: A Triumph Over Expectations

In 2017, the early leaders in energy storage made an audacious bet: they predicted that by 2025, 35 gigawatts of grid technology would be installed in the United States. This goal sounded improbable even to those who believed the growth trajectory was promising. A small number of independent developers and utilities had managed to install just 500 megawatts of batteries nationwide, equivalent to one good-size gas-fired power plant.

Building 35 gigawatts would entail a 70-fold growth in just eight years.

The number didn’t come out of thin air; the Energy Storage Association worked with Navigant Research to model scenarios based on a range of assumptions. Praveen Kathpal, then chair of the ESA board of directors, recalled that the association decided to run with the most aggressive of the defensible scenarios in its November 2017 report.

From Margins to Mainstream

Eight years later, the industry has come a long way. The U.S. crossed the threshold of 35 gigawatts of battery installations this July and then passed 40 gigawatts in the third quarter, according to data from the American Clean Power Association. This growth is significant: the group of vendors, developers, and installers who stood at the margins of the power industry just eight years ago are now second only to solar developers in gigawatts built per year.

Storage capacity outnumbers gas power in the queues for future grid additions by a factor of 6.5, according to data compiled by Lawrence Berkeley National Laboratory. “Storage has become the dominant form of new power addition,” Kathpal said. “I think it’s fair to say that batteries are how America does capacity.”

Early Challenges and Triumphs

Back in 2017, when I was covering the young storage industry for an outlet called Greentech Media, there was much to write about the enormous potential of energy storage. But it required caveats like “if states change their grid regulations to allow this new technology to compete fairly on its merits.” Those batteries that did get built in 2017 look tiny by today’s standards. The locally owned utility cooperative in Kauai built a trailblazing 13-megawatt/52-megawatt-hour battery, the first such utility-scale system designed to sit alongside a solar power plant.

And 2017 saw the tail end of the Aliso Canyon procurement, a foundational trial for the storage industry in which developers built a series of batteries in Southern California in just a handful of months to shore up the grid after a record-busting gas leak—adding up to about 100 megawatts. “You saw green shoots of a lot of where the industry has gone,” Kathpal said.

California passed a law creating a storage mandate in 2010, then found a pressing need for the technology to neutralize the threat of summertime power shortages. Kauai’s small island grid quickly hit a saturation point with daytime solar, so the utility wanted a battery to shift that clean power into the nighttime.

From False Starts to Triumph

The storage industry pioneers somehow nailed the 35-gigawatt goal, but market growth defied their expectations in several important ways. Kelly Speakes-Backman, who served as the CEO of ESA from 2017 to 2021, said that the group expected a steady ramp to the 35 gigawatts. But there were plenty of false starts, such as when states passed mandates but never enforced them, and when federal regulators ordered wholesale markets to incorporate storage but regional implementation dragged on for years.

The ESA report predicted that 2018 deployments would cross the 1-gigawatt threshold, which didn’t actually happen until 2020.

But real installations significantly outpaced the expected numbers in the run-up to 2025. The group hoped to hit 9.2 gigawatts installed this year, and instead the industry is on track to deliver 15 gigawatts.

Speakes-Backman said, “Once it hit, it really hit.” The regional breakdown of storage growth didn’t play out as ESA expected either. The analysis anticipated that the Northeast would install more than 10 gigawatts, nearly as much as the Southwest (including California and Hawaii); after all, it noted, New England states had passed aggressive greenhouse gas reduction policies.

In fact, the Northeast has done exceedingly little to build large-scale storage.

But other regions surpassed ESA’s expectations. California, Texas, and Arizona alone hold roughly 80% of all U.S. battery storage capacity. This lopsided concentration of storage could be seen as a weakness of the industry. Noah Roberts, executive director of the recently formed Energy Storage Coalition, said that the pattern reflects how storage has sprung up in spots that suffer acute grid stress.

America’s Battery Boom

LG Energy Solution opened a factory to produce battery cells for grid storage in Michigan this summer that is capable of producing up to 16.5 gigawatt-hours at full capacity; the company expects to raise its North America capacity to 40 gigawatt-hours by the end of 2026. “All of our projects integrated before 2022 combined are smaller than some of our newer individual projects,” noted Tristan Doherty, chief product officer of LG Energy Solution subsidiary Vertech, which focuses on grid batteries.

The storage industry was vindicated in stretching its aspirations beyond what many thought was possible. Those early adopters knew their technology was valuable, but even they didn’t guess how it would connect with the generational forces reshaping the U.S. economy, from AI to the onshoring of industry. A clarification was made on Dec. 4, 2025: This story has been updated to reflect that LG Energy Solution’s goal to reach 40 GWh of battery-manufacturing capacity is for North America as a whole, not just for the company’s Michigan plant.