Batteries have become cheaper than open-cycle gas turbines — TechCrunch

Four-hour energy storage systems have become cheaper than open-cycle gas turbines on every continent and in each of the 43 markets studied by consulting firm Wood Mackenzie. TechCrunch reports, citing the company’s new report.

Data center demand drives up prices

Open-cycle gas turbines are often used as peaker plants, generating electricity during periods of highest demand. They are easier to manufacture than combined-cycle turbines, but are less efficient and more expensive to operate.

Prices for gas turbines are rising due to demand from developers of artificial intelligence data centers, which are buying up available models. Even open-cycle turbines now require a wait of two to four years, while queues for combined-cycle turbines extend into the early 2030s. This is raising the prices of new gas power plants.

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Solar generation is the cheapest

Wood Mackenzie forecasts a further decline in the cost of electricity from batteries, while electricity generated by gas turbines will become more expensive over the coming decades. Solar power has already become the cheapest form of new generation in every market studied.

In North America, solar power prices are under pressure from tariffs and import restrictions, although large solar projects have better prospects. According to Wood Mackenzie, 168 GW of capacity is largely shielded from short-term price shocks by One Big Beautiful Bill provisions on tax credits for projects whose construction has already begun or will be completed by the end of 2027.

Wood Mackenzie forecasts that in the Middle East and Africa, four-hour batteries will be 33% cheaper by 2035, displacing gas peaker generation on cost. In China, energy storage costs are 55% lower than in neighboring countries. Wood Mackenzie analyst Ahmed Jamil Abdullah said this economic shift is decisive and strengthening.