Facilities fueling energy storage installations

Battery storage is growing across the board, and that includes homes. A new industry report from the American Clean Power Association and Wood Mackenzie projects the commercial energy storage market will grow 27% over the next five years, driven largely by data centers and other big facilities adding batteries for backup power. When utility-scale and residential systems are counted too, overall storage installations are expected to grow more than 50% by 2031, with residential storage growing about 9% a year on average.

That said, home battery installations actually dropped in the most recent quarter, falling 15% to 676 megawatts. The report points to two causes: federal clean energy and energy efficiency tax credits were eliminated under the One Big Beautiful Bill Act, and California, which drives a lot of national demand, had seen an unusual rush of installations earlier in the year as homeowners raced to beat reduced state solar and storage incentives before a court settled a legal challenge to them in June. That rush inflated the prior quarter's numbers, so the recent drop looks more like a return to normal than a sign of falling interest.

On the technology side, battery systems are lasting longer. The average duration of U.S. energy storage systems rose from 2.8 hours to 3.5 hours. Longer-lasting batteries, including newer types beyond the standard lithium-ion, could eventually offer homeowners more backup power per system, though the report's near-term numbers point mainly to commercial and utility-scale growth rather than a residential boom.