Four-Hour Battery Storage Now Beats Gas Turbines on Cost in All 43 Modeled Markets
4-hour battery storage is cheaper to install than gas turbines all across globe
Wood Mackenzie's latest global LCOE report finds four-hour battery storage is now cheaper to install than open-cycle gas turbines in every one of the 43 markets where both were modeled. In the Middle East and Africa, storage costs are forecast to fall 33% to $80/MWh by 2035, displacing gas peaking across the region. China remains the global benchmark, with storage costs more than 55% below the rest of Asia Pacific.
This economic shift is decisive and widening. Gas turbine shortages and rising fuel volatility are driving up peaking costs, while expanding battery manufacturing continues to push storage costs down.
- alwa
I’d like to take a moment to praise the writing here. Rigorous, dense, and well-organized; communicative rather than coughing up tables of raw figures in prose form.
I’d refer to the source studies, but at $9,990 per region… Ms Pickerel’s overview seems plenty informative for me.
Regarding EMEA:
> Grid-scale battery storage costs are now decisively cheaper than gas peaking across the region. [and price will fall another 33% in the decade ahead]. This shift means storage is displacing open-cycle gas turbines on cost in every gas market across the region, marking a significant structural turning point for power system planning across both the Gulf and Africa.
The analyst’s bottom line:
> From Latin America to Asia Pacific, the combination of falling storage costs and world-class renewable resources is closing off the economic case for new gas peaking capacity, while long-term contracted renewables increasingly set the ceiling rather than the floor on power costs.”
Heady times! For all the gnashing of teeth about regulating our way out of combustion-based production—it’s ultimately superior technology that’s ripened to displace gas peaker plants, no arm-twisting required. “Not with a bang, but a whimper”…
- Bratmon
This entire article seems to be based on an assumption that the cost of batteries will go down 33% over the next 10 years because demand is so high, but costs of gas turbines will go up over the next 10 years because demand is so high.
Neither of these assumptions are based on anything other than "That's the number we had to put in to the model to get the conclusion we want".
- adrianN
That seems fairly obvious, but afaik the problem is not bridging four hours, it’s bridging a cloudy week without wind in winter. For that gas currently seems cheaper
- gcanyon
I remember arguing with friends literally only 3-4 years ago about whether solar (plus batteries) could ever fully replace fossil fuel solutions. Some of my friends are idiots. ...Or this is just a super-remarkable development :-)
- jl6
> For onshore wind, continuous capex and opex improvements are expected to drive LCOE down 16% by 2060
What’s with the forecasts going as far out as 2060?? Given the scale of changes we’ve seen in just the last 10 years, looking forward 34 years seems absurd, and to still only expect a 16% drop in cost?
- throwaway7783
Im a noob to this area, but why is the article picking up on 4 hour batteries? Why not 8 or 12 hour batteries (nights, cloudy days)?
- bell-cot
Note that the article is specific to open-cycle gas turbines. Which are somewhat cheaper than the (more complex) combined-cycle gas turbines, and can be brought online far faster - but are far less efficient. So, the open-cycle turbines have been economical only for covering short-duration demand peaks - a use case where batteries are now superior.
Vs. longer-duration needs, like a couple calm (bad for wind power) dark (bad for solar power) weeks in winter - you will need combined-cycle turbines or something for those, because installing that many batteries would cost too much.
https://en.wikipedia.org/wiki/Gas-fired_power_plant#Plant_ty...
- NetMageSCW
The title really needs the word “peaker” in it to make sense.