Battery storage systems play a crucial role in maintaining grid stability by balancing electricity supply and demand. They store energy from renewable sources like wind and solar, releasing it when needed, which helps to save power during low-demand periods. In this rapidly growing sector, lithium-ion batteries are taking the lead, driving the energy transition with their high efficiency and flexibility.
Utility-scale battery energy storage is booming across the United States. According to the latest report from the U.S. Energy Information Administration (EIA), till July 2024, operators added 5 gigawatts (GW) of new capacity to the U.S. power grid, making a total available battery storage capacity more than 20.7 GW. Notably, developers plan to add 15 GW in 2024 and another 9 GW in 2025.
Source: EIA
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Lithium-ion batteries Lead the Charge
The U.S. power sector has overwhelmingly adopted lithium-ion batteries for energy storage. These batteries now account for over 90% of the global demand, outpacing their use in personal electronics. As the world transitions from fossil fuels, battery storage is crucial to improving energy efficiency and supporting clean energy adoption.
Energy storage, while not a primary electricity source, provides crucial backup power. It stores electricity generated from the grid or renewable sources, making it a key player in the renewable energy ecosystem. Batteries allow electricity produced during peak generation times to be stored and later supplied during peak demand periods, enhancing grid reliability and reducing energy losses.
Despite impressive growth, the battery storage sector faces several challenges. Supply chain disruptions, inflation, and delays in grid interconnection are slowing the pace of new projects. However, experts like energy analysts and battery enthusiasts expect these issues to improve by the end of this year, leading to an even faster deployment.
Michael Craig, a professor at the University of Michigan, emphasizes the need for rapid technological advancement to meet ambitious carbon-reduction goals. The EIA predicts that utility-scale battery storage will almost double by the end of 2024, a sign that the industry is moving in the right direction.
Battery Storage Set to Drive 60% of CO2 Reductions by 2030: IEA
Battery storage is becoming increasingly attractive as costs continue to fall. Companies like Tesla and Enphase are scaling their battery storage offerings to meet growing demand, driven by the rise of AI and data centers, which are expected to increase energy consumption dramatically.
According to industry projections, the global battery storage market will grow in leaps and bounds with the push for renewable energy adoption. By 2030, electric vehicles are expected to displace millions of barrels of oil daily, further boosting the need for large-scale energy storage solutions in the power sector.
As battery storage continues to expand, it is clear that this technology is a cornerstone of the energy transition, enabling the shift away from fossil fuels and toward a more sustainable, electrified future.
According to the IEA, to triple global renewable energy capacity by 2030, while ensuring electricity security, energy storage must grow six-fold. In the Net Zero Emissions (NZE) Scenario, storage capacity needs to reach 1,500 GW by 2030. Batteries will drive 90% of this expansion, growing 14-fold to 1,200 GW, supported by technologies like pumped storage and compressed air.
Source: IEA
This rapid growth requires battery deployment to rise 25% annually. Batteries are key, as they account for 60% of CO2 reductions in 2030, directly in EVs and solar PV, and indirectly through electrification and renewables.
Low-Cost Cathode Could Slash Lithium Battery Costs
A team led by Hailong Chen at Georgia Tech has developed a low-cost iron chloride (FeCl3) cathode for lithium-ion batteries (LIBs). This breakthrough could reduce electric vehicle (EV) costs, where batteries make nearly half the price. FeCl3 costs just 1-2% of traditional cathode materials like nickel and cobalt while delivering the same energy capacity, making it a game-changer for EVs and energy storage.
The FeCl3 cathode is not only cheaper but also provides higher voltage than popular alternatives like lithium iron phosphate (LiFePO4). Chen’s team aims to push for all-solid-state LIBs, which could improve safety and efficiency. This could also enhance large-scale energy storage and strengthen the power grid.
Chen’s research, which began in 2019, shows FeCl3 as a scalable and eco-friendly option. The team expects the technology to be commercially available within five years, promising to reshape EVs and renewable energy storage with lower costs and greater sustainability.
Source: Hailong Chen and research team, Georgia Tech
BESS Market Poised for Explosive Growth by 2030, A McKinsey Report
The Battery Energy Storage System (BESS) market is rapidly growing, creating a huge opportunity for investors and companies. In 2022, over $5 billion was invested in BESS, nearly tripling from the previous year.
- According to McKinsey, the global BESS market is projected to grow significantly, reaching between $120 billion and $150 billion by 2030—more than 2x its current size.
Source: McKinsey
Although the BESS market is expanding, it remains fragmented, leaving many companies uncertain about their next move. Now is the time for businesses to pinpoint the best opportunities and secure their position. With rising competition and increasing demand for renewable energy, companies must act swiftly to carve out their share of this booming market.
Key Strategies to Succeed in the BESS Market
McKinsey has come up with innovative solutions for companies to succeed in the dynamic BESS market:
They should focus on filling gaps in the value chain and prioritizing software development. System integrators can explore new opportunities by partnering with battery manufacturers, while battery makers can add integration services to target specific sectors. Additionally, investing in software that optimizes BESS performance will unlock larger markets and drive higher margins.
Strengthening supply chains and staying agile are also crucial. Companies need strategic partnerships and multi-sourcing options to manage supply disruptions. Smaller firms should act quickly, leverage their intellectual property, and take risks to stay competitive against larger players.
With global investments in BESS surging, reaching between $120 billion and $150 billion by 2030, companies need to identify the best opportunities and act decisively.
Source: McKinsey
Can the U.S. Dominate the Battery Energy Storage Market?
EIA has also estimated that U.S. battery storage capacity could increase by 89% by the end of 2024. This growth depends on developers bringing planned energy storage systems online by their intended commercial operation dates.
- Currently, developers aim to expand U.S. battery capacity to over 30 gigawatts (GW) by the end of 2024. This would surpass the capacity of petroleum liquids, geothermal, wood and wood waste, and landfill gas.
California and Texas dominate the battery storage market. California leads with 7.3 GW of installed battery storage, followed by Texas with 3.2 GW. Significantly, Vistra’s facility in Moss Landing, California, is currently the largest, with 750 megawatts (MW).
By 2025, developers expect to complete over 300 utility-scale battery storage projects across the U.S., with Texas accounting for about 50% of the planned capacity. The five largest battery storage projects set to come online in 2024 or 2025 include:
- Lunis Creek BESS SLF (Texas, 621 MW)
- Clear Fork Creek BESS SLF (Texas, 600 MW)
- Hecate Energy Ramsey Storage (Texas, 500 MW)
- Bellefield Solar and Energy Storage Farm (California, 500 MW)
- Dogwood Creek Solar and BESS (Texas, 443 MW)
Source: EIA
With ambitious battery storage plans and declining costs, the U.S. is poised to achieve a cleaner, more reliable energy future, rapidly closing the gap with China.
- FURTHER READING: EV Wars and Breakthroughs: BYD to Overtake Tesla, CATL’s New Battery With 1.5M KM Range
The post EIA Expects Explosive Growth in U.S. Battery Storage—Can America Ascend to Dominance? appeared first on Carbon Credits.
More and more small and medium-sized businesses are hearing the same question from their larger customers: What is your carbon footprint? That question now travels down entire supply chains, and it arrives next to tender requirements, certification criteria, and rising customer expectations.
The accounting differences that decide whether your nature investment shows up in inventory, in BVCM, or nowhere at all.
The question reaches a procurement team about three weeks before the next sustainability committee meeting. Someone has read about insetting. Someone else has just signed off on an offset purchase. The CSO wants to know if the two are interchangeable. The answer is no, and the GHG Protocol Land Sector and Removals Standard is the reason why.
This article walks through what each term means at audit-grade specificity, what the standards actually say about how each gets counted, and how to decide which tool fits which target. The insetting vs offsetting question is one of the most-searched in corporate climate strategy, and one of the most poorly answered. By the end of this piece, you should be able to brief a committee on the difference without notes.
The two definitions, in plain English
Offsetting means buying carbon credits generated outside your value chain and retiring them against your residual emissions. The reduction happens somewhere else, financed by you, and the credit is the receipt.
Insetting means investing in emission reductions or removals inside your own value chain, typically with suppliers, where the reduction is directly linked to the products and services you buy. The reduction happens inside the boundary of your Scope 3 inventory, and the accounting treatment is fundamentally different.
The shorthand from the University of Oxford’s Nature-based Insetting Initiative is useful: insetting is what you do with the supply chain you have; offsetting is what you do with the supply chain you do not have.
What the GHG Protocol Land Sector Standard actually says
The GHG Protocol Land Sector and Removals Standard, finalised in 2024 after a multi-year pilot, sets the rules for how land-based emission reductions and removals enter corporate inventories. The Standard distinguishes between inventory accounting (Scope 1, 2, and 3) and project or intervention accounting (a separate methodology for crediting).
For insetting, the practical implication is that supplier-level interventions, when properly measured and attributed, can reduce your Scope 3 category 1 (purchased goods and services) emissions in your inventory. The reduction is not a credit retired against the inventory; it is a lower inventory number, period.
For offsetting, the credit is retired separately. It can be reported as a contribution toward a net-zero claim under the SBTi Beyond Value Chain Mitigation framework or as part of a VCMI Carbon Integrity claim, but it does not lower the inventory number.
A practical consequence: if your Science Based Target requires a 50% absolute reduction in Scope 3 emissions by 2030, insetting moves you toward the target. Offsetting does not. This single point of difference reshapes the procurement decision.
When insetting counts toward Scope 3 (and when it does not)
Insetting counts toward Scope 3 only when several conditions are met:
- The intervention must occur with an entity in your value chain.
- The emissions reduction or removal must be measured against a defensible baseline.
- The reduction must be attributed to your share of that supplier’s output, not double-counted with other buyers.
- It must follow the inventory accounting rules in the GHG Protocol Land Sector Standard, not the project accounting rules used to generate credits.
The most common failure mode is double counting. If your supplier sells the same reduction as a credit on the voluntary market and also reports it to you as a Scope 3 reduction, the math breaks. The Standard requires you to address this risk, typically by purchasing and retiring the supplier-issued credit as part of your inventory or by contractual provisions that prevent the supplier from selling the reduction twice.
When insetting does not count toward Scope 3: when the intervention sits with a supplier you do not buy from, when the baseline is not defensible, when the attribution is unclear, or when the documentation does not survive audit. Those cases default to Beyond Value Chain Mitigation, which is still useful but operates on a different ledger.
The procurement and supplier engagement question
Insetting is harder than offsetting. That is the unfashionable truth most buyers eventually confront. Offsetting is a transaction; insetting is a relationship.
To run an insetting program, you need supplier mapping precise enough to know which farms or facilities sit at which Scope 3 boundary. You need an engagement model that gets suppliers to participate, which usually requires multi-year commitments and shared economics. You need an MRV architecture that measures the right things and produces audit-ready documentation. And you need a contractual structure that prevents double counting and protects both sides.
The trade-off you receive in return is significant. Reductions count against your inventory rather than your residual. Supplier relationships deepen, which protects sourcing continuity. Yield and quality improvements often follow regenerative interventions, which reduces your input cost over time. And the regulatory file, under CSRD, CSDDD, EUDR, and the SBTi FLAG Guidance, is materially stronger.
Choosing the right tool for the right target
A practical decision rule. If your target is a science-based Scope 3 reduction and you operate in a FLAG sector or source FLAG commodities, insetting is the structurally correct tool. If your target is a net-zero claim that includes neutralising hard-to-abate residual emissions outside your value chain, BVCM via high-integrity offsets is the structurally correct tool. Most companies with material Scope 3 exposure need both, in different proportions, sequenced over time.
The sequencing matters. Insetting takes longer to stand up but produces a permanent reduction in the inventory. Offsetting can be transacted faster but does not change the inventory and now sits under tighter claim restrictions. Treat them as complementary tools with different jobs, not as substitutes. The Accountability Framework Initiative and the IUCN Global Standard for Nature-based Solutions both provide useful guardrails for the insetting side, with biodiversity, human rights, and benefit-sharing requirements that go beyond carbon math.
If you are mapping a Scope 3 reduction roadmap and need to scope which interventions count toward your inventory versus which sit in Beyond Value Chain Mitigation, the carbon and sustainability experts at Carbon Credit Capital can help you structure a nature-based supply chain investment program that fits your FLAG exposure, your target architecture, and your audit horizon. Schedule a consultation.
Net zero is often described as a balancing act: cut what you can, account for the rest, and reach zero on the ledger. That framing is useful, but it leaves something out. It treats every tonne of carbon as interchangeable and every route to zero as equally sound, while the science tells a more specific story.
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