Four-Hour Batteries Are Now Cheaper Than Open-Cycle Gas Turbines Globally, Wood Mackenzie Finds
Data center demand has stretched gas turbine wait times into the 2030s, accelerating an economic shift toward battery storage across 43 markets.
Four-hour duration battery storage is now cheaper than open-cycle natural gas turbines across every continent and in all 43 markets surveyed by consultancy Wood Mackenzie, according to a report published by TechCrunch (https://techcrunch.com/2026/10/09/batteries-are-now-cheaper-than-natural-gas-turbines-used-at-many-data-centers/).
The pricing shift comes as surging power demand from artificial intelligence data centers strains power grids and equipment supply chains. Developers building data centers have bought up gas turbines, escalating equipment costs and lengthening procurement timelines. Open-cycle turbines, which are simpler to build but less efficient and more expensive to run than closed-cycle plants, now require two to four years to procure. Waitlists for closed-cycle turbines extend into the early 2030s.
These equipment backlogs have driven up construction expenses for new gas-fired generation, affecting both private developers and utilities that rely on open-cycle plants for peaking capacity during high-demand hours. Wood Mackenzie projects that electricity generated from gas turbines will become more expensive over the coming decades, while battery electricity costs will continue to decline.
Solar power remains the cheapest form of new generation across all 43 markets in the study. In North America, where trade tariffs and import restrictions have placed upward pressure on solar hardware, approximately 168 gigawatts of utility-scale solar is protected from near-term price increases under safe-harbor provisions in federal legislation, provided projects begin construction or finish before the end of 2027.
Regional cost disparities are also widening. In China, energy storage costs are 55 percent lower than in neighboring countries. In the Middle East and Africa, Wood Mackenzie forecasts that four-hour batteries will be 33 percent cheaper than gas peaking plants by 2035, outcompeting gas on cost across every market in the region.
"This economic shift is decisive and widening," Ahmed Jameel Abdullah, principal analyst at Wood Mackenzie, said in a statement accompanying the report.
Sources
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