Batteries beat gas peakers on cost globally, but U.S. faces trade headwinds
Wood Mackenzie's latest levelized cost of electricity report finds that four-hour battery storage has fallen below open-cycle gas turbines on cost in all 43 global markets it models, and that single-axis tracker solar is the lowest-cost new-build power source in 43 of 48 modeled markets. North American developers face tariffs, anti-dumping and countervailing duty actions and Section 232 import restrictions, with module prices projected to climb about 5% annually through 2030. Federal tax credits under the Inflation Reduction Act offset Foreign Entity of Concern sourcing restrictions and domestic supply bottlenecks, while load growth from AI and data center development is forcing utilities to re-evaluate capacity planning.
Why it matters: The divergence between falling global storage costs and North American trade barriers and load growth bears on the energy transition, since it shapes where renewable-plus-storage builds displace new gas peaking capacity.