Batteries Enhance Grid Reliability Amid Growing Energy Demands, Reports NERC

Batteries Are Enhancing Grid Reliability: NERC

According to the North American Electric Reliability Corporation (NERC), batteries are significantly improving the reliability of the electric grid. In Texas last year, there were instances when batteries supplied the entire capacity needed for frequency regulation services, as noted in NERC’s 2025 State of Reliability report, published on June 13, 2025.

### Key Insights from the NERC Report

The report highlights that the United States and Canada experienced 30 weather-related events last year that caused damages exceeding $1 billion. Importantly, none of these incidents necessitated operator-initiated load shedding, a notable improvement compared to similar past events. Overall, the bulk power system remained reliable, despite challenges posed by adverse weather and shifts in resource mix and utilization.

NERC stated, “Today’s transmission system is demonstrably more reliable and resilient, with a decline in the severity and duration of outages.” However, the North American grid is facing challenges due to the increasing demand from large loads like data centers and the operational characteristics of inverter-based resources.

### The Role of Battery Energy Storage Systems (BESS)

The report points out that reliability improvements have been observed in regions with a high concentration of battery energy storage systems (BESS). As data centers expand rapidly across the country, NERC identifies this as a significant near-term reliability challenge. Although there is uncertainty regarding the pace and extent of data center capacity growth, experts agree that these facilities are driving an increase in electricity demand. According to Bain & Company, data centers could account for 44% of the U.S. electricity load growth from 2023 to 2028.

These large energy demands can develop more quickly than the necessary generation and transmission infrastructure, which can lead to decreased system stability. NERC emphasizes the need for more accurate models of data centers’ operational characteristics to ensure reliability and prevent instability caused by significant fluctuations in electricity demand.

In 2024, over 45 GW of new inverter-based capacity was added to the bulk power system. However, NERC notes that the response of inverter-based resources (IBRs) to system disturbances has impacted some solar facilities, leading to ride-through issues at large battery storage and wind plants. In response, NERC recently issued an alert with recommendations for IBR operators regarding modeling and performance.

### The Future of Battery Storage

NERC’s report underscores the potential of batteries to enhance grid reliability. The U.S. Energy Information Administration projects that utility-scale battery storage will more than double in the next two years, reaching nearly 65 GW by the end of 2026. Areas with high concentrations of BESS and supportive incentives have shown improvements in frequency response.

In Texas, battery capacity surpassed 10 GW in December, with an additional 19 GW planned by the end of 2025. NERC highlighted that while all industrial battery installations can provide frequency support, in Texas, this provision is mandated through a Reliability Standard. This requirement, combined with the growing installed capacity and quick response times, positions these installations as crucial components of the Texas Interconnection’s frequency response.

Last year, the Texas grid successfully managed several instances where batteries accounted for up to 100% of the total capacity for frequency regulation services. NERC’s performance analysis manager, Jack Norris, stated, “These events provide supporting evidence that at current penetration levels, with proper requirements and incentives, BESS can improve primary frequency response, an essential reliability service.”

While challenges remain with the rapid increase of these resources, their flexible capabilities are currently advantageous to grid reliability, reinforcing their viability as a form of bulk power system energy storage.