Battery energy storage systems (BESS) play the imperative role in the energy transition of providing firming capacity.
In the UK, battery storage approvals reached record levels this year, with 8.4GW of new projects submitted in Q2 2025, doubling the previous year’s total. This surge coincides with a broader 16.1GW increase in renewable energy capacity approvals. Key drivers include falling battery costs, streamlined planning processes, and strong government support.
These changes are creating a ripple effect globally, with countries like Australia now investing in large-scale energy storage solutions to support growing renewable generation and ensure grid stability.
UK’s record battery growth signals global change
According to the Financial Times, in the second quarter of 2025, over 16.1GW of new renewable capacity was approved across 323 projects, marking a remarkable 195% increase compared to the same period last year. This surge underscores the UK’s progress toward its ambitious target of achieving 95% carbon-free electricity by 2030. Major projects, like SSE’s Berwick Bank offshore wind farm, underscore the scale and impact of this expansion.
Alongside this, the UK saw over 100 battery storage applications totalling 8.4GW in Q2 2025, doubling last year’s figures. Lower battery costs drive this rapid increase, thanks to technological advancements that make energy storage systems more feasible for developers and investors.
Regulatory efforts to streamline approval processes have also played a crucial role in accelerating project submissions. Investor confidence is growing, supported by attractive returns from grid-balancing services and a maturing market that favours large-scale energy storage investments.
Why the UK’s battery storage growth is a global game changer
The UK’s rapid growth in battery storage is not just a national success story — it signals a global acceleration in energy storage worldwide.
Global trends in energy storage
Across key regions, including the EU, the US, and Australia, similar surges in battery storage projects reflect the growing recognition of its critical role in supporting renewable energy integration and ensuring grid stability.
According to Discovery Alert, these markets are accelerating investments and project developments, mirroring the momentum seen in the UK and driving a broader global energy transition.
Additionally, BloombergNEF highlights how the expanding maturity of the energy storage market is attracting increased international investment. This influx of capital is enabling the development of innovative energy models, thereby further accelerating the global adoption of energy storage solutions.
Cost reduction and technological advancements
Falling battery costs are a key driver of the global energy storage boom. In 2024, the global average cost of battery storage dropped below $300 per kWh, driven by advances in battery chemistry, manufacturing, and supply chains.
Experts project that if prices fall to $250 per kWh, storage costs could drop to around $60 per MWh, boosting profitability and accelerating adoption. In some regions, such as China, lithium battery pack prices are already below $100 per kWh, with global prices expected to follow by 2026.
These cost reductions are further supported by technological innovations in battery recycling, energy density, and safety, making energy storage more efficient and sustainable. Together, these trends are making large-scale energy storage projects more financially viable, supporting the global transition to clean energy.
Investor confidence and economic impact
Investor interest in energy storage is growing rapidly, driven by the improving economics of projects and the revenue potential from grid services.
The increasing bankability of storage projects has unlocked new financing opportunities, enabling the development of larger and more complex storage projects globally. This surge in investment is essential to meeting ambitious clean energy goals and accelerating the transition to more sustainable power systems.
Australia’s path forward in energy storage
Australia is rapidly emerging as a leader in large-scale BESS. With ambitious renewable energy goals and a growing need to stabilise the grid, our BESS market is set for significant growth.
In early 2025, Australia added around 1.5GW of new battery storage capacity, supported by a surge in investments exceeding AU$2bn in the first quarter. The National Electricity Market (NEM) is on track to nearly sevenfold its BESS capacity to 16.8GW by 2027, demonstrating strong momentum behind battery deployment.
This growth is being driven by several key factors, particularly falling battery costs. Prices for lithium-ion battery packs continue to decline, making large-scale BESS projects more affordable and attracting strong interest from investors and developers.
In 2025, the Federal Battery Rebate scheme was introduced, offering a discount of up to 30% of the initial cost (or a maximum of $372 per kWh). This rebate will gradually decrease each year until 2030 and is part of an AU$2.3bn expansion of the Small-scale Renewable Energy Scheme (SRES), which helped fuel Australia’s rooftop solar growth.
Australia’s regulatory landscape is also evolving, with potential reforms inspired by countries like the UK, which has streamlined battery storage approvals. These changes could expedite project assessments and approvals, thereby removing bottlenecks and accelerating deployment.
How Arche supports the market to capitalise on battery storage growth
Energy consultants like Arche are crucial partners for businesses seeking to navigate Australia’s rapidly evolving energy storage market. With our deep expertise and decades of experience serving the energy sector, Arche identifies the best opportunities, optimised energy storage solutions, and make sense of a complex and ever-changing landscape.
Using specialised tools, we simplify essential components of project development such as feasibility assessments, financial modelling, and risk analysis, ensuring that projects are set up for long-term success.
Over and above technical support, Arche keeps businesses on track with regulatory changes, helping them stay compliant while maximising local and global incentives. As the market for BESS grows, energy consultants play a crucial role in shaping long-term strategies, enabling businesses in Australia’s rapidly expanding clean energy sector.