SYDNEY, October 2025 – Australia has solidified its position as a global leader in energy storage, now ranking as the world’s third-largest utility-scale battery market, trailing only China and the United States. According to a recent report by independent research firm Rystad Energy, the country’s pipeline of large-scale battery storage projects has reached 14 GW/37 GWh in capacity—representing projects either financed or nearing financial close. This surge highlights Australia’s aggressive push to replace retiring coal-fired power plants and meet soaring electricity demand driven by renewable energy integration and data center expansion.

Unprecedented Growth and Global Standing

Australia’s battery storage pipeline has expanded at a staggering pace. Over the past year, project reserves surged by 45 GW, from 109 GW in August 2024 to 154 GW in 2025. On a per-capita basis, Australia is the global leader, with over 1 GWh of utility-scale battery capacity per million people—more than double the ratios of China and the United States, which both sit below 400 MWh per million.

David Dixon, Senior Analyst for Australian Renewable Energy at Rystad, noted that while Australia’s land area and market size do not naturally position it among the top three, its investment attractiveness and execution success have made it a standout. “We are building record numbers of utility-scale batteries,” he said, “but this also means record levels of commissioning and competition for grid access and resources”.

Drivers of the Battery Boom

Several factors underpin Australia’s battery storage explosion:

1. Coal Plant Retirements: Approximately 11 GW of coal-fired capacity is scheduled to retire within the next decade, including plants like the 2.8 GW Eraring facility in New South Wales. Batteries are critical to filling the reliability gap left by these closures.
2. Renewable Energy Targets: The government aims to source 82% of electricity from renewables by 2030, necessitating storage to stabilize intermittent solar and wind power.
3. Policy Support: Initiatives like the Capacity Investment Scheme (CIS) and the National Battery Strategy have mobilized over A$210 billion in projected investments by 2030.

The Australian Energy Market Operator (AEMO) forecasts a 28% increase in electricity consumption over the next decade, from 178 TWh in 2024–25 to 229 TWh by 2034–35. To support this growth, AEMO fast-tracked 10 battery projects totaling 2.4 GW in the June 2025 quarter alone.

Flagship Projects and Technological Leadership

The Waratah Super Battery (WSB) in New South Wales exemplifies Australia’s ambition. Developed by Akaysha Energy, the 850 MW/1.6 GWh project is the largest and fastest-responding battery system globally. Its first phase (350 MW/700 MWh) achieved grid registration in August 2025, and upon completion, it will provide a System Integrity Protection Scheme (SIPS) to safeguard power supply to Sydney, Newcastle, and Wollongong during grid disturbances.

Nick Carter, CEO of Akaysha Energy, emphasized the project’s role as a cost-effective grid solution: “We cannot build transmission networks fast enough to support wind and solar growth. Batteries like Waratah ensure reliability while enabling the transition away from coal”.

Other key projects include Neoen’s 270 MW/540 MWh Western Downs BESS in Queensland and a pipeline of 4 GWh under Akaysha’s portfolio.

Household Batteries Add Distributed Strength

The utility-scale boom is complemented by a grassroots surge in home battery installations. Since July 2025, when the federal Cheaper Home Batteries Program took effect, nearly 100,000 residential systems have been registered—adding ~2,000 MWh of capacity in just 17 weeks. South Australia leads this trend, with batteries included in 65% of new solar installations in 2025, up from 29% two years prior.

The average household system size has also grown to ~25 kWh, far exceeding typical daily consumption of 4–6 kWh, indicating that homeowners are prioritizing grid support and future energy needs.

Challenges and Future Outlook

Australia’s storage expansion faces headwinds:

• Supply Chain and Costs: Project development costs have risen 50–80% over the past two years due to competition for engineering resources and equipment.
• Grid Integration: As AEMO CEO Daniel Westerman stressed, timely deployment of new storage, generation, and transmission is essential to maintain reliability.

To meet 2050 net-zero targets, AEMO estimates Australia will need at least 49 GW of storage capacity, including utility-scale batteries, pumped hydro, and virtual power plants. Emerging technologies like 8-hour long-duration storage—pioneered by Chinese manufacturers like CATL—and grid-forming inverters are poised to play a pivotal role.

A Global Test Case

Australia’s rapid ascent in energy storage offers lessons for other nations balancing renewable adoption with grid stability. As Dixon observed, “Utility-scale BESS is a major renewable energy success story for Australia”. With robust policy backing, private investment, and technological innovation, the country is poised to remain a laboratory for the global energy transition.