Energy storage deployment is set for another record in 2026 by adding 188 gigawatts (GW) or 535 gigawatt-hours (GWh) of energy storage projects, 62% of which are installed in China, the US and Australia, according to BloombergNEF’s latest outlook.

China is surprisingly strong given the phaseout of a major policy last year which mandated energy storage for renewables build. The transition to different revenue and business models led to uncertainty in the market this year, but new supportive policies are reinforcing the country’s lead. These include a firming requirement for standalone solar and wind projects and a renewed 300GW deployment target by 2030.

The US maintains strong build, supported by preserved tax credits and accelerated by on-site energy storage demand from data centers. Meanwhile, India leapfrogs peer markets as tender-driven annual additions top6GW this year from a few hundred megawatts last year. Beyond the UK, Germany and Italy, which led European build last year, a myriad of countries emerge in the gigawatt-scale addition this year, including Bulgaria, Romania, Poland, France, Greece, Netherlands and Ukraine.

Global annual additions grow 11% year-on-year in gigawatts in 2027 to 209GW/638GWh, as deployment broadens beyond today’s largest markets. Spain, the United Arab Emirates, Chile and Japan accelerate build, supported by power market fundamentals, diversified revenue stacks and utility-led procurement activity. By2036, the growth engine shifts to emerging regions such as Latin America, Sub-Saharan Africa, Southeast Asia and other European countries.

Sodium-ion batteries are increasingly gaining traction amid the recent increase in material prices for lithium iron phosphate materials. Sodium-ion battery storage has a lower fire risk and can operate across a wide temperature range, reducing the need for liquid cooling and auxiliary energy use. Despite these advantages, limited manufacturing scale and cost competitiveness pose hurdles to adoption for sodium-ion batteries as well as other non-lithium long-duration energy storage. Lithium iron phosphate (LFP) is expected to be the primary chemistry for energy storage over the next decade due to its cost competitiveness, high cycle life and supply chain dominance.