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					</table><p>At the end of 2024, price arbitrage was the leading use of utility-scale batteries, accounting for 43% in the California Independent System Operator (<a href="https://www.caiso.com/" target="_blank" rel="noopener">CAISO</a>) and about 50% in the Electric Reliability Council of Texas (<a href="https://www.ercot.com/" target="_blank" rel="noopener">ERCOT</a>), according to the U.S. Energy Information Administration (<a href="https://www.eia.gov/" target="_blank" rel="noopener">EIA</a>).</p>
<p><a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/09/battery1.png"><img loading="lazy" decoding="async" class="aligncenter wp-image-84742 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/09/battery1.png" alt="battery1" width="752" height="414" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/09/battery1.png 752w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/09/battery1-300x165.png 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/09/battery1-650x358.png 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/09/battery1-624x344.png 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/09/battery1-600x330.png 600w" sizes="(max-width: 752px) 100vw, 752px" /></a></p>
<p>The survey was conducted between 2023 and 2024.</p>
<p>Most of the U.S.’ utility-scale battery capacity is in the two electricity markets that cover much of California and Texas.</p>
<p>By the end of 2024, CAISO had reported 11.7 GW and ERCOT had reported 8.1 GW of battery capacity.</p>
<p><a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/09/battery-2.png"><img loading="lazy" decoding="async" class="aligncenter wp-image-84743 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/09/battery-2.png" alt="" width="752" height="426" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/09/battery-2.png 752w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/09/battery-2-300x170.png 300w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/09/battery-2-650x368.png 650w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/09/battery-2-624x353.png 624w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2025/09/battery-2-600x340.png 600w" sizes="(max-width: 752px) 100vw, 752px" /></a></p>
<p>In the U.S. EIA’s annual report, operators of utility-scale batteries were asked about the common use cases of their battery systems. Price arbitrage was the most common use case of battery systems. Other use cases include frequency regulation, management of excess wind and solar generation, system peak shaving, and load management.</p>
<p>Arbitrage involves buying electricity when prices are relatively low and selling that electricity when prices are high. In previous years as well, batteries were primarily used for price arbitrage.</p>
<p>In the 2023 survey, operators reported that 66% of all utility-scale battery capacity had arbitrage among its uses, and 41% of the total battery capacity was primarily used for this purpose.</p>
<p>However, like previous years, frequency regulation remained the second common use case for battery capacity, accounting for 24% of the total. Frequency regulation involves maintaining the grid’s frequency of 60 cycles per second.</p>
<p>According to BloombergNEF’s (BNEF) latest outlook, the global energy storage capacity additions are <a href="https://www.mercomindia.com/global-energy-storage-market-remains-resilient-amid-us-and-china-policy-changes" target="_blank" rel="noopener">expected</a> to grow by 35% in 2025 to 94 GW or 247 GWh. BNEF forecasts a compound annual growth rate of 14.7% between 2025 and 2035, with yearly additions reaching 220 GW or 972 GWh by 2035. The growth will be driven by traditional markets and large-scale utility projects launched or under construction in countries such as Saudi Arabia, South Africa, Australia, the Netherlands, Chile, Canada, and the UK.</p>
<p>Signaling a growing energy storage market, the cost of four-hour lithium-ion battery systems could <a href="https://www.mercomindia.com/li-ion-battery-prices-could-drop-to-108-kwh-in-2050-nrel" target="_blank" rel="noopener">decline</a> from $334/kWh in 2024 to as low as $108/kWh or remain as high as $307/kWh by 2050, according to the National Renewable Energy Laboratory.</p>


Price Arbitrage Remains Key Use Case for Battery Capacities: EIA


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					</table><p>San Antonio Municipal Utility company <a href="https://www.cpsenergy.com/" target="_blank" rel="noopener">CPS Energy</a> has invited bids to purchase power from 500 MW of standalone energy storage systems in the United States.</p>
<p>Existing as well as upcoming projects are eligible to bid.</p>
<p>The last day to submit the bids is October 18, 2023.</p>
<p>Bidders must post and maintain a security amount equal to $40,000 per MW of contract storage capacity within ten days of receiving the work order but in any event before commencing the facility&#8217;s construction.</p>
<p>Storage systems can be either transmission scale storage or distribution scale storage. The potential duration of the power purchase agreement can extend up to 25 years.</p>
<p>The system size should not exceed 50 MW for transmission scale storage, whereas distribution scale storage should range from 5 MW to 9.95 MW per substation, with an aggregate capacity of up to 10 MWac per substation.</p>
<p>Transmission scale storage systems must offer energy storage capabilities of up to 4 hours or more than 8 hours, while distribution scale storage systems should provide up to 4 hours of energy storage. Both systems must complete at least one energy storage cycle per day.</p>
<p>Transmission scale storage systems will be connected to the Electric Reliability Council of Texas (ERCOT) grid, while distribution scale storage systems can be linked to either the 13 kV or 35 kV CPS Energy distribution grid.</p>
<p>Tier 1 components are required for this storage resource and must be chargeable from the grid by CPS Energy.</p>
<p>The resource should be deliverable to specific nodes such as resource nodes, hub nodes, distribution generation resource nodes, settlement-only distribution generator nodes, and load zone CPS.</p>
<p>Bidders must provide detailed financial information for the most recent three fiscal years. If the project is or will be owned by an entity at the project level other than the bidder, the financial statements of the majority parent company (with over 50% ownership) for the most recent three fiscal years must be submitted.</p>
<p>If the project is owned by an entity other than the bidder, this entity will serve as the counterparty to the service contract agreement. The proposals should include an organizational chart illustrating the corporate relationship between the entity and the bidder, outlining the ownership structure and ownership percentages of the bidder.</p>
<p>The energy storage market in the U.S., including grid-scale, residential and community, commercial, and industrial segments, <a href="https://www.mercomindia.com/us-grid-scale-energy-storage-q2-2023/" target="_blank" rel="noopener">experienced</a> an 80% year-over-year growth in the second quarter of 2023, adding a total of 5,597 MWh. The report revealed that the grid-scale energy storage segment was pivotal in driving this growth with 5,109 MWh, an impressive 172% quarter-over-quarter expansion.</p>
<p>A U.S. Energy Information Administration report <a href="https://www.mercomindia.com/us-battery-utility-scale-storage-capacity-to-gw-by-2025" target="_blank" rel="noopener">suggests</a> that power developers and project owners could add utility-scale battery storage capacity of up to 30 GW in the U.S. over the next three years.</p>


CPS Energy Invites Bids for 500 MW of Energy Storage Systems in US

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