Early signs of the impact of batteries

This report analyzes the emerging role of grid-scale batteries in the European Union as of 2025, highlighting their ability to compete with expensive gas-fired power during peak demand hours and reduce the curtailment of renewable energy. Using Italy as a primary example and California as a comparative case study, the document details how falling battery costs and widening price spreads are driving a record project pipeline aimed at lowering wholesale electricity prices and reducing reliance on fossil fuels.

• In 2025, wholesale electricity prices in 21 EU countries rose compared to 2024, with increases ranging from 3% in Greece to 22% in Austria. These price hikes were primarily driven by spikes during morning and evening hours when costly gas generators are most needed. During these peak gas-use hours, EU prices were on average 11% higher than in 2024, whereas prices during hours of abundant clean power (7am to 4pm) rose by only 3%.
• EU large battery capacity exceeded 10 GW in 2025, more than double the 4 GW recorded in 2023. While Italy and Germany currently host nearly half of these batteries, a record pipeline of projects—led by Germany, Poland, and Italy—could push total capacity beyond 40 GW. This growth is supported by a 20% average annual decline in battery costs over the last decade and increased imports of Chinese batteries in the first 11 months of 2025.
• Italy serves as a key example of battery deployment, with 1.9 GW of large batteries representing about 20% of the EU's operating capacity. In September 2025, these batteries discharged an average of 1.1 GW during early evening hours (7–8 pm), meeting 3% of demand. The report suggests Italy could follow California's trajectory, where battery contribution to evening peak demand grew from 3% in September 2021 to 22% in September 2025, reducing fossil fuel share from 44% to 34%.
• Batteries can mitigate the waste of clean power caused by curtailment. In 2025, Germany curtailed approximately 9.6 TWh of wind and solar generation, representing nearly 4% of total generation for those fuels. The report estimates that if Germany's announced battery projects (10.5 GW/26.3 GWh) had absorbed this power, it could have avoided one third of the 2025 curtailment, reducing gas generation by 3.7% (3 TWh) and saving €0.8 billion in redispatch costs and gas purchases.

APA

Ember (2026). Early signs of the impact of batteries. https://ember-energy.org/chapter/early-signs-of-the-impact-of-batteries/

Chicago

Ember. Early signs of the impact of batteries. 2026. https://ember-energy.org/chapter/early-signs-of-the-impact-of-batteries/.

Wikipedia

{{cite report |author=Ember |title=Early signs of the impact of batteries |date=22 January 2026 |url=https://ember-energy.org/chapter/early-signs-of-the-impact-of-batteries/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{ember2026early, author = {{Ember}}, title = {{Early signs of the impact of batteries}}, institution = {Ember}, year = {2026}, month = jan, url = {https://ember-energy.org/chapter/early-signs-of-the-impact-of-batteries/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }