Batteries: The Workhorse of an Affordable, Reliable Grid

The report examines how battery energy storage can enhance grid reliability—specifically resource adequacy, stability, and resilience—while reducing costs. It contrasts the successful deployment of batteries in Texas (ERCOT) and California (CAISO), where well-defined ancillary services and value stacking have lowered costs, with the PJM region, where high uplift costs and interconnection hurdles persist. The author recommends that regulators and planners define competitive ancillary service products, properly value resource adequacy, and modernize interconnection processes to replace expensive legacy fossil fuel generators.

• Battery prices have seen a rapid decline of 90 percent since 2010, enabling them to support three core pillars of grid reliability: resource adequacy (meeting peak demand), stability (short-term frequency and voltage regulation), and resilience (recovery from outages).
• In Texas and California, batteries have successfully lowered costs by competing in ancillary service markets and utilizing 'value stacking,' which allows them to earn revenue from multiple streams including capacity markets, energy arbitrage, and ancillary services.
• The PJM region faces significant economic inefficiencies, incurring nearly a billion dollars in out-of-market uplift costs in the first quarter of 2025, which is ten times higher than any other US regional transmission organization.
• Battery deployment in regions like PJM is hindered by restrictive interconnection practices, noncompliance with FERC Order 2023, and a capacity accreditation framework that discounts the marginal value of battery storage.

APA

RMI (2025). Batteries: The Workhorse of an Affordable, Reliable Grid. https://rmi.org/resources/batteries-the-workhorse-of-an-affordable-reliable-grid/

Chicago

RMI. Batteries: The Workhorse of an Affordable, Reliable Grid. 2025. https://rmi.org/resources/batteries-the-workhorse-of-an-affordable-reliable-grid/.

Wikipedia

{{cite report |author=RMI |title=Batteries: The Workhorse of an Affordable, Reliable Grid |date=10 September 2025 |url=https://rmi.org/resources/batteries-the-workhorse-of-an-affordable-reliable-grid/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rmi2025batteries, author = {{RMI}}, title = {{Batteries: The Workhorse of an Affordable, Reliable Grid}}, institution = {RMI}, year = {2025}, month = sep, url = {https://rmi.org/resources/batteries-the-workhorse-of-an-affordable-reliable-grid/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }