From Wood Mackenzie: Battery Storage Cheaper Than Gas Turbines in 43 Markets

How could the finding that battery storage is cheaper than gas turbines affect LG Energy Solution?

Possible What happens if… A possibility worth considering, not a forecast.

Battery cost decline may boost demand for LG Energy Solution's storage The finding that battery storage is now cheaper than open-cycle gas turbines suggests a major shift in energy generation economics. According to Wood Mackenzie, four-hour duration batteries are less expensive than gas turbines in all 43 markets surveyed. This cost advantage is predicted to continue, with batteries expected to be 33% cheaper than gas peaking in the Middle East and Africa by 2035, displacing gas peaking on cost in those regions. This increasing cost-effectiveness of battery technology could drive significant long-term demand for battery storage systems, benefiting manufacturers like LG Energy Solution.

Reported by 1 independent outlet Written Oct 9

Effect: Strong positive
How direct: Stated in the reporting
When: Over the long term
The story: Gone quiet

How it reaches LG Energy Solution

Reported by news outlets

Wood Mackenzie reported that in 43 surveyed markets, four-hour duration batteries are less expensive than open-cycle gas turbines. The consultancy predicts that battery electricity costs will continue to decline while gas turbine costs will grow more expensive, with batteries projected to be 33% cheaper than gas peaking in the Middle East and Africa by 2035.

1 report connects these two. Brind only summarizes; follow a link to read the reporting itself.
- techcrunch.com Oct 9

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The facts so far

As reported. Each one links to where it comes from.

Four-hour duration batteries were less expensive than open-cycle gas turbines in all 43 markets surveyed.techcrunch.com
In the Middle East and Africa, four-hour batteries will be 33% cheaper by 2035, displacing gas peaking on cost.techcrunch.com
The cost of electricity from batteries is predicted to continue declining while electrons from gas turbines will only grow more expensive.techcrunch.com

Why it matters

The shift in energy economics represents a fundamental change in how power is generated and stored globally. As battery storage becomes cheaper and more efficient than traditional peaking power plants, it threatens the market for natural gas turbines, which are currently being driven up in price by AI data center developers.

This trend is particularly pronounced in regions like the Middle East and Africa, where the cost displacement of gas peaking by batteries is predicted by 2035. For battery manufacturers, this signals a massive, long-term expansion of the market for Energy Storage Systems (ESS) across diverse global regions.

What we don't know yet

Will regulatory policies in key markets accelerate or slow the adoption of battery storage over gas turbines?
How quickly will the supply chain for battery components scale to meet the predicted global demand?

What would change this answer

Governments introduce subsidies or mandates for grid-scale battery storageThe adoption rate of battery storage will accelerate, making the positive effect on LG Energy Solution more immediate and certain.

Tariffs or import restrictions significantly increase the cost of battery componentsThe cost advantage of batteries could be eroded, slowing the displacement of gas peaking and reducing the long-term demand outlook.

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About EMEA
How might the cost decline of batteries affect the energy market dynamics in Europe, given the trends seen in the Middle East and Africa?

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Reporting

techcrunch.comOct 9

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The full eventWood Mackenzie: Battery Storage Cheaper Than Gas Turbines in 43 Markets Everything aboutLG Energy Solution

Brind's analysis is written by AI from the reporting linked above and can be wrong. This explainer is a possibility worth considering, not a forecast: steps marked as Brind's reasoning are not stated in the reporting. It is not investment advice; do your own research.