Texas begins 2026 with 13.9 GW and 22.9 GWh of commercially operational grid-scale BESS capacity. This represents a near-doubling of the fleet in a single year, with 6 GW of new capacity coming online in 2025 alone.

Key Takeaways

• Texas enters 2026 with 13.9 GW of battery capacity - nearly double the 7.8 GW at the start of 2025
• 60 new sites began operations in 2025, with Brazoria County attracting 16% of total capacity
• New queue applications fell 50% in H2 2025, signalling cooling investor appetite
• Only 85% of battery capacity with a signed Interconnection Agreement today will likely come online
• Modo Energy projects 40-55 GW operational by 2029, depending on attrition assumptions

6 GW of new battery capacity came online in 2025 - the largest year in ERCOT history

6 GW and 11 GWh of new battery energy storage capacity began commercial operations last year. This brought total operational capacity to 13,888 MW (13.9 GW) and total energy capacity to 22,853 MWh (22.9 GWh).

Buildout accelerated throughout the year, with Q3 2025 delivering over 2 GW of new capacity.

60 new sites began commercial operations, with Brazoria County in particular attracting a cluster of resources. Nearly 1 GW (16% of total) across 8 assets began operating in the region, driven by proximity to Houston’s congestion-driven price spreads.

52% of 2025's capacity additions came from owners with no prior Texas battery assets.

A mix of 18 new owners brought 3.1 GW online across four segments:

• Pure-play storage developers (1.25 GW): esVolta, Intersect Power, Gridstor, Nightpeak - scaling after proving models elsewhere
• European oil majors (670 MW): TotalEnergies, Eni, Equinor.
• PE / infra funds (664 MW): Brookfield, SER Capital Partners, Excelsior.
• Japanese utility (174 MW): Tokyo Gas America - first foray into US standalone storage

Existing owners also continued to expand aggressively:

• ENGIE remains dominant at 20% market share (2.8 GW) - added another 1 GW in 2025.
• Enel, Jupiter Power, SMT Energy, Tesla all brought significant projects online
• Top 5 owners hold 47% of the market; top 10 hold 63%

Battery durations have shifted towards two-hour systems

Two-hour batteries accounted for 4.2 GW of the 6 GW added in 2025. This brings the average duration of batteries operating in ERCOT to 1.65 hours - up from 1.5 hours at the start of 2025.

The move toward longer durations reflects falling costs and elongating evening price spreads, as batteries rely on extended energy arbitrage cycles for their revenue, giving longer-duration assets an edge.

Systems with durations over 2.5 hours remain rare, with only 112 MW commissioned in 2025 - NextEra’s Inertia BESS (13 MW | 50 MWh) and Shamrock Energy Storage (99.3 MW | 300 MWh).

However, several new projects have been publicly confirmed as four hours in duration and are nearing completion:

• Alamo City BESS – 120 MW / 480 MWh, developed by OCI Energy, located in Bexar County. Expected online in late 2027.
• Ferdinand BESS – 200 MW / 800 MWh, developed by Eolian, also located in Bexar County. Targeted for the first half of 2026.
• Padua 2 BESS – 150 MW / 600 MWh, also developed by Eolian, and also located in Bexar County. Targeted for the first half of 2026

To find out how newer longer-duration projects perform, read our analysis on the investment case for four-hour duration storage in ERCOT.

New battery applications to the queue have fallen by 50%

The record growth seen in ERCOT’s battery capacity in 2025 is the result of connection applications filed as early as 2020, and as such, is not a gauge for investment appetite today. In fact, developers are submitting far fewer applications for new battery projects.

New grid-connection applications from batteries in Texas fell to 13.6 GW in H2 2025 - a 50% decline from the first half of the year.

Why are new battery applications declining in Texas?

The fall in new applications reflects tempering investor expectations due to:

• Falling merchant revenues - dropping from $192/kW in 2023 to an average of $43/kW in 2024 and 2025.
• Increased costs associated with tariff impacts and the the One Big Beautiful Bill Act (OBBBA), which will limit access to Investment Tax Credits for some developers, particularly for projects coming online in the later part of this decade.

Subscribers to Modo Energy's ERCOT research can continue reading to learn about:

• Queue Analysis: A revised outlook on how long it takes to move through ERCOT’s interconnection queue.
• ​2026 pipeline: The status of battery projects in the near-term, including where and when these will come online.
• Buildout projections: How much of - and when - ERCOT’s 200+ GW queue is likely to achieve commercial operations.

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For questions on this research, contact ovais@modoenergy.com

Only 85% of batteries with a signed Interconnection Agreement may come online

ERCOT has received 1,470 applications from battery projects wishing to connect to the grid over the past six years. 1,354 of these project are classified as ‘large generators’ greater than 10 MW, subject to the full interconnection study process.

These large battery applications fall into three groups: