The United States installed record-high energy storage capacity in the second quarter of the year as grid operators and utilities turned to storage to improve grid reliability and meet rising power demand, according to a new industry report released on Tuesday.

The industry added 20.2 gigawatt-hours (GWh) of new capacity in the quarter, making it the largest quarter for installations on record and lifting total installations in the first half of 2026 to 30.8 GWh, according to the U.S. Energy Storage Market Outlook Q3 2026 (ESMO) published by the Solar Energy Industries Association (SEIA) and Benchmark Mineral Intelligence.

The utility-scale segment led the increase with 18 GWh installed, supported largely by seven gigawatt-scale projects. Arizona accounted for more than 6.2 GWh of utility-scale projects, which the report said was the largest quarterly deployment for any state in history.

The residential sector added 657 megawatt-hours (MWh) of storage, while the commercial and industrial (C&I) segment installed 1.8 GWh, driven largely by power demand from data centers, SEIA and Benchmark Mineral Intelligence said. The spread across utility-scale, residential and C&I installations highlights how storage is being used across different parts of the power system, from supporting grid operations to meeting on-site demand.

Citing stronger demand for energy storage to support grid reliability, SEIA and Benchmark Mineral Intelligence raised their installation forecast by 11.5% through 2030. The groups now expect the market to exceed annual installations of 110 GWh and reach a cumulative 683 GWh by the end of the decade.

“The upward revision comes as the industry continues to set deployment records, with more than 10% of all energy storage capacity currently installed in the U.S. coming online in Q2 alone,” SEIA said.

“Energy storage is no longer just a California and Texas story anymore,” said Shan Tomouk, BESS & Energy Lead at Benchmark Minerals. “We’re seeing strong pipeline growth in Arizona, Nevada, Oregon, Colorado and several other states.”

Battery energy storage supplied more electricity to the grid in the first eight months of 2026 than in all of 2025, the report showed, underscoring how quickly the technology has moved from a niche grid resource to a larger part of day-to-day electricity supply.

Last month, the U.S. Energy Information Administration (EIA) said utility-scale battery storage capacity in the United States had climbed sharply over the past three years, with an annual average growth rate of 70%.

By Michael Kern for Oilprice.com