REPORT: US Energy Storage Installations Through Q3 2025 Surpass 2024 Totals

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REPORT: US Energy Storage Installations Through Q3 2025 Surpass 2024 Totals

• Utility-scale five-year forecast increases 15% compared to H1 2025
• 5.3 GW installed in Q3, 31% YOY growth
• Utility-scale leads with 4.6 GW, 27% YOY growth

WASHINGTON, D.C., December 16, 2025 - The U.S. energy storage market continued steady growth in Q3 2025, with 5.3 gigawatts (GW) installed nationwide, pushing 2025 year-to-date totals ahead of combined 2024's installations according to the latest U.S. Energy Storage Monitor report released today by the American Clean Power Association (ACP) and Wood Mackenzie. This forward momentum continued despite evolving supply chains and ongoing policy uncertainty.

Overall Q3 installations increased 31% year-over-year, though the market declined 6% compared to Q2 2025's record highs. The utility-scale storage segment drove growth with 4.6 GW installed in Q3, a 27% increase year-over-year, with 82% of installed capacity concentrated in Texas and California.

The residential storage market continued its expansion for the sixth consecutive quarter, installing 647 megawatts (MW) in Q3, a 70% year-over-year increase. California, Arizona, and Illinois led deployments as attachment rates reached new highs. Wood Mackenzie projects Q4 2025 will set a record for the residential sector as customers accelerate installations ahead of the Section 25D tax credit expiration.

The Community, Commercial and Industrial (CCI) segment installed 33 MW in Q3, down 8% year-over-year. California captured 54% of installations with 17.8 MW, while Illinois emerged as a key growth market alongside Massachusetts, driven by state rebate programs and community storage projects.

"Strong growth in the U.S. energy storage market reflects a simple reality: meeting rising demand and keeping the grid reliable increasingly requires storage," said John Hensley, ACP Senior Vice President of Markets and Policy Analysis. "These installations deliver the flexible, reliable grid support America needs today, boosting reliability and keeping power bills in check."

Market May Plateau in 2026 and 2027, but Five-Year Outlook Increases

Although domestic battery manufacturing continues to ramp up to meet new tariffs and non-foreign entities of concern (FEOC) requirements for the Investment Tax Credit (ITC), Wood Mackenzie projects near-term supply chain adjustments and constraints will drive an 11% contraction in the US utility-scale storage market in 2026 and an 8% decline in 2027. However, the market is positioned for strong recovery, with double-digit year-over-year growth projected for 2028 and 2029 as domestic manufacturing capacity comes online. Overall, Wood Mackenzie forecasts nearly 93 GW of storage will be installed across the U.S. over the next five years. Notably, the utility-scale five-year forecast has increased 15% compared to pre-One Big Beautiful Bill Act (OBBBA) projections, while the CCI segment is projected to grow 23% from 2025 to 2029.

"Despite new federal policies and tariffs, the market fundamentals remain exceptionally strong," said Allison Feeney, research analyst at Wood Mackenzie. "Continued access to the ITC, cost-competitive domestic cell manufacturing, merchant revenue potential, state policy and load growth are driving our increased five-year outlook."

Strong State Incentive Programs are Cushioning Federal Policy Uncertainty in Key Markets

California's Net Billing Tariff (NBT), Massachusetts' Solar Massachusetts Renewable Target (SMART) 3.0, and Illinois' rebate programs are sustaining steady CCI deployment through 2029. Meanwhile, the residential segment's shift toward third-party ownership models-which accounted for 57% of the market in Q3 2025-is helping to mitigate the impact of the Section 25D expiration.

Allison Weis, Global Head of Storage at Wood Mackenzie, said "We're seeing states step up with innovative programs, grids increasingly reliant on storage for reliability, and costs at record lows. The industry's ability to navigate these challenges and maintain a 15% increase in our five-year utility forecast since the passage of the OBBA demonstrates that storage has evolved from an emerging technology to an essential grid resource."

Notable Market Developments:

• Wisconsin installed 210 MW over Q2 and Q3, the state's first large-scale storage projects
• Puerto Rico led quarter-over-quarter residential growth driven by resilience demand
• North Carolina and Arizona set quarterly residential records in Q3 2025

Wood Mackenzie's media relations team:

Mark Thomton
+1 630 881 6885
[email protected]

Hla Myat Mon
+65 8533 8860  
[email protected]

Chris Boba
+44 7408 841129
[email protected]

Angelica Juarez
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About Wood Mackenzie

Wood Mackenzie is the global insight business for renewables, energy and natural resources. Driven by data. Powered by people. In the middle of an energy revolution, businesses and governments need reliable and actionable insight to lead the transition to a sustainable future. That's why we cover the entire supply chain with unparalleled breadth and depth, backed by over 50 years' experience in natural resources. Today, our team of over 2,000 experts operate across 30 global locations, inspiring customers' decisions through real-time analytics, consultancy, events and thought leadership. Together, we deliver the insight they need to separate risk from opportunity and make bold decisions when it matters most. For more information, visit woodmac.com.

The American Clean Power Association (ACP) is the leading voice of today's multi-tech clean energy industry, representing energy storage, wind, utility-scale solar, clean hydrogen, and transmission companies. ACP is committed to meeting America's energy and national security goals and building our economy with fast-growing, low-cost, and reliable domestic power.

Learn more at cleanpower.org, and follow ACP on LinkedIn, Instagram, Facebook, and X.