According to a new report from the U.S. Energy Information Administration (EIA), U.S. small-scale battery storage capacity almost doubled in 2021 (the year of the most recent data).

Small-scale battery storage refers to storage facilities that have less than 1 MW of generating capacity

“Small-scale battery storage is a significant part of the energy storage landscape in the United States,” said the report. “In 2021, small-scale battery storage reached 1,094 megawatts (MW), almost double the total in 2020 (630 MW), and more than ten times the total in 2017 (101 MW). In comparison, large-scale (or utility-scale) battery storage capacity totaled 4,712 MW in 2021.”

The percentage of small-scale battery storage that is net-metered has also been steadily increasing since 2016. In 2021, 71 percent of small-scale battery storage (781 MW) was net-metered versus 36 percent in 2016. (Net-metering tariff arrangements permit a facility [using a meter that reads inflows and outflows of electricity] to sell excess power generated above its load requirement back to the electric grid, typically, but not necessarily, at a rate equivalent to the retail price of electricity.)

According to the report, the vast majority (91 percent) of small-scale battery storage capacity is installed in the residential and commercial sectors. Of the 1,094 MW of small-scale capacity reported by utilities in 2021, 68 percent (740 MW) was installed in the residential sector, and 23 percent (254 MW) was installed in the commercial sector. A smaller percentage, seven percent (79 MW), was installed in the industrial sector. The remaining two percent (21 MW) was directly connected to the distribution grid, such as a utility at its own distribution substation. Across all sectors, small-scale battery storage capacity is typically owned by the end user.

California reported the largest amount of small-scale battery storage (775 MW) of any state, with 71 percent of the total capacity. Of all small-scale batter storage capacity in California, over 97 percent was installed in three electric utility service territories: Pacific Gas and Electric (PGE), with 364 MW; Southern California Edison (SCE), with 271 MW; and San Diego Gas and Electric (SDGE), with 114 MW.

In 2021, most installations of small-scale battery storage in the commercial sector in California were in SCE’s territory (67 percent) and SDGE’s territory (20 percent). Most installations of residential small-scale battery storage (54 percent) and industrial small-scale battery storage (92 percent) in California were in PGE’s territory.

California’s large share of small-scale battery storage capacity can be attributed to the state’s Self-Generation Incentive Program (SGIP), which provides financial incentives for installing customer-sited distributed energy resources.

Outside of California, the states with the most reported small-scale battery storage capacity were Hawaii, with 124 MW; Texas, with 40 MW; and New York, with 21 MW.

Most (85 percent) of the 318 MW of small-scale battery storage capacity outside of California was installed in the residential sector. Only minimal small-scale battery storage capacity in the industrial sector existed outside of California. In the commercial sector, small-scale battery storage was mostly reported in New York and Hawaii, as well as three other states – Illinois, Georgia, and Ohio.