WoodMac: Battery storage beats gas peakers on cost — SkimNews
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- Wood Mackenzie found 4-hour battery storage is now cheaper than gas peakers in markets across the globe, with US 4-hour storage running 65-75% cheaper than new open-cycle gas turbine peakers for 2026 commercial operation.
- GE Vernova, Siemens Energy, and Mitsubishi each carry backlogs of 35 GW to 116 GW as turbine prices are projected to hit $600/kW by end of 2027 — a 195% increase since 2019.
- North American gas generation is entering "a supply deficit cycle through the late 2030s" driven by data center load growth, reinforcing the long-term economic case for renewables and storage, per the firm.
- In the Middle East and Africa, 4-hour storage is forecast to fall 33% to $80/MWh by 2035, displacing gas peaking on cost across every gas market in the region.
- China remains the global storage cost benchmark at more than 55% below the rest of the Asia Pacific average, "illustrating how manufacturing scale is redrawing the global cost map."
- Saudi Arabia and the UAE lead solar competitiveness, with solar LCOE on track to fall below $20/MWh by 2033; single-axis tracker solar is the lowest-cost new-build technology in 43 of 48 modeled markets.
- US solar costs are pressured by tariffs, anti-dumping actions, and import restrictions, with module prices expected to rise ~5% annually through 2030 and projected jumps of 6% in 2027 and 14% in 2028 for residential and commercial projects.
Why it matters: Utilities and developers planning new peaking capacity in the US now have a decisive economic signal: 4-hour batteries are already 65-75% cheaper than new gas peakers for 2026 operation. The three major gas turbine manufacturers — sitting on 35-116 GW of backlogs and facing a 195% price climb since 2019 — will struggle to defend replacement economics as battery storage falls toward $80/MWh by 2035 across the Middle East and Africa.
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