Clean energy’s biggest problem has always been simple: the sun doesn’t always shine, and the wind doesn’t always blow. For decades, this intermittency held renewables back from truly replacing fossil fuels. But storage technology is finally catching up, and the results are starting to show.
In 2023 alone, the world added roughly 45 gigawatts of new energy storage capacity—that’s about a 70% jump from the year before, according to the International Energy Agency. Even analysts who track this stuff closely were surprised. The main drivers? Climate urgency is getting real, costs have plummeted, and governments are finally setting serious targets for clean energy.
China dominated the market, installing more than half of all new storage globally. Its battery manufacturing boom has driven prices down fast, making large projects financially workable. In the US, the Inflation Reduction Act sparked a wave of domestic battery investment, with companies announcing grid-scale projects across the country.
Europe saw strong growth too, especially in Germany, Italy, and the UK—places where grid operators are struggling to handle increasingly variable solar and wind output. The EU’s goal of 45% renewable energy by 2030 means storage isn’t optional anymore; it’s become essential.
Beyond Lithium-Ion
Lithium-ion batteries still rule the market, but they’re not the end of the story. Researchers have been pushing hard on the technology’s weak points: raw material supply, safety concerns, and degradation over time.
Solid-state batteries are finally moving from lab experiments toward actual products. Companies like Toyota, Samsung SDI, and QuantumScape have working prototypes and say they’ll start mass production in 2025–2026. These batteries swap liquid electrolytes for solid materials, which could mean more energy density, fewer fire risks, and longer lifespans. Whether manufacturing can scale up smoothly is still an open question.
Sodium-ion batteries are another option, particularly for big installations where weight doesn’t matter much but cost does. Chinese manufacturers CATL and BYD have already started producing them commercially, targeting stationary storage where they can compete on price without needing lithium, cobalt, or nickel.
Then there’s iron-air batteries—the most radical departure from the lithium-ion approach. Form Energy, a startup backed by Bill Gates’s Breakthrough Energy Ventures, built rechargeable iron-air batteries that can hold charge for up to 100 hours. Their first commercial project—a 15 MW, 150 MWh system in Minnesota—came online in 2024, showing the tech actually works for multi-day storage.
Storing Energy for Longer
Most batteries today handle short-term storage well: smoothing out minute-to-minute swings in supply and demand, providing quick grid services. But grids increasingly need to store energy for days or even weeks at a time, and that requires different approaches.
Pumped hydroelectric storage remains the oldest and most established method. New projects are under development from Scotland to Tasmania, and recent innovations—like underground pumped storage or repurposing old mines—have opened up more locations.
Gravity-based storage got attention when Energy Vault built its grid-scale system in Switzerland. The idea is simple: use excess electricity to lift heavy blocks, then lower them to generate power when needed. It’s long-lasting, doesn’t degrade much, and doesn’t need mountains.
Hydrogen is emerging as the leading option for seasonal storage. When there’s too much renewable electricity, electrolyzers turn it into green hydrogen. When demand peaks, the hydrogen gets converted back to power through fuel cells or turbines. It’s expensive right now, but for very long-duration storage, it might be the only practical option.
What Policies Are Actually Doing
Regulations have evolved fast, recognizing that storage is crucial for decarbonization. Market rules that once favored fossil fuels are being rewritten to properly pay batteries for what they do: frequency regulation, voltage support, capacity, and buying low-sell-high arbitrage.
In the US, the Federal Energy Regulatory Commission removed some barriers to storage participation in wholesale markets. States like California and New York set storage targets that have driven massive investment.
The EU’s updated Renewable Energy Directive includes storage-specific rules and pushes member states to develop storage strategies. Germany has been especially successful with its market-driven approach—the country will need around 100 gigawatts of storage to hit its 80% renewable electricity target by 2030, according to Fraunhofer researchers.
China combines industrial policy with deployment mandates, subsidizing domestic manufacturers while requiring provinces to pair renewable projects with storage. Its 14th Five-Year Plan targets 100 gigawatts of storage by 2025, and it’s basically on track.
What Could Still Go Wrong
Progress has been impressive, but problems remain.
Supply chains for lithium, nickel, and cobalt are vulnerable. Can manufacturers scale up fast enough to meet climate goals? A lot of announced factories haven’t actually started production yet, so timelines remain fuzzy.
Getting projects connected to the grid is another bottleneck. Developers face years of delays just waiting for interconnection. Transmission infrastructure needs serious upgrading.
Then there’s the end-of-life question. Battery volumes are exploding, but recycling infrastructure hasn’t kept pace. Figuring out what to do with decommissioned batteries—both for environmental reasons and to recover valuable materials—will matter more each year.
Looking Ahead
The pieces are coming together: better technology, lower costs, supportive policies, and undeniable climate pressure. The innovations coming out of labs and factories now offer real paths toward grids running mostly on renewables.
The technical barriers to deep decarbonization are looking more surmountable as battery options multiply and long-duration storage matures. The real challenges now are building manufacturing capacity faster, upgrading grid infrastructure, and setting policies that actually reward storage for what it’s worth. That’s the hard part—not the science.
With continued investment and commitment, storage breakthroughs will underpin a clean energy future that seemed impossibly far away just a few years ago.
