Batteries powered by renewables are reducing reliance on gas peaking plants as the electricity grid shifts, with 2025 battery capacity surpassing the combined total of the previous eight years.

The Australian Energy Market Operator warns of possible gas shortages in New South Wales and Victoria, but the 2025 forecast pushes those shortages to at least 2029 due to Bass Strait field depletion, underscoring ongoing uncertainty and the need for contingency planning.

Despite batteries’ gains, experts say gas plants will still be needed to ensure reliability during periods of low renewable generation, such as cloudy or windless days, until coal is fully displaced by renewables.

Analysts note that renewables backed by batteries could potentially supply nearly all a nation’s electricity, boosting energy sovereignty and reducing exposure to fossil-fuel shocks.

Increased battery deployment allows more solar energy to be stored for evening peak demand, reducing midday solar waste and decreasing the need for gas and coal during peak hours.

Experts describe batteries as storing electricity like a commodity, reshaping grid design away from peaking gas plants and long-duration fossil fuel backups.

Battery adoption is accelerating due to falling costs and rising capacity, with a 20% drop in battery construction costs in the year to mid-2024 and an expected 15% further reduction this financial year.