Giant batteries drain economics of gas power plants

Batteries vs Gas Plant Economics

• Large grid batteries are eroding the business case for gas peaker plants by:
  • Shifting required capacity from peak to closer to average load.
  • Capturing lucrative “fast frequency response” and reserve markets once dominated by thermal plants.
• Batteries respond in milliseconds, versus seconds–minutes for gas turbines, making them superior for many grid services.
• Developers and financiers can no longer assume gas plants will run steadily for 20+ years; modeling must account for shrinking operating hours and uncertain revenues.

Grid Stability, Inertia, and Ancillary Services

• Traditional synchronous generators provide inertia and frequency support via rotating mass.
• As they are displaced by inverter-based resources, frequency stability becomes harder.
• Batteries and advanced inverters can emulate inertia (“virtual synchronous machine” / grid-forming) and are already providing such services at scale.
• There is discussion of flywheels, superconducting magnetic storage, and other fast-response technologies, but they are niche and/or expensive.

Cost Trajectories: Renewables, Fossil, Nuclear

• Several comments argue unsubsidized solar/wind + storage are at or near gas combined-cycle costs, with much more room for cost reduction (perovskite solar, sodium batteries).
• Fossil fuel plants face potential future carbon pricing or offset costs, adding investment risk.
• Nuclear is criticized as far more expensive than wind/solar and chronically late and over budget; others see it as necessary firm capacity.

Long-Duration Storage & Overbuilding Debate

• Consensus: short-duration (hours–days) battery storage is already economical in many markets.
• Disagreement on seasonal / multi-week storage:
  • Some say overbuilding solar/wind plus curtailment, transmission, and some pumped hydro/hydrogen is cheaper than massive batteries.
  • Others stress extreme weather “dunkelflaute” events and argue for firm, dispatchable capacity (gas with storage, nuclear, geothermal, hydrogen) rather than relying mainly on batteries.
• Several note that batteries discharging only once a year have very poor amortization; gas storage facilities are closer analogs for seasonal buffers.

Transport and Electrification

• Debate over whether “renewables can’t power trains, planes, and trucks”:
  • Many point out electrified trains are mature, trucks are technically viable but need infrastructure, and only long-haul aviation/shipping clearly require chemical fuels.
  • Ideas include e-fuels made from electricity and shifting more freight to rail; others doubt large modal shifts given politics and existing infrastructure.

Policy, Politics, and Market Design

• Political uncertainty (subsidies, carbon policy, mandates) is seen as a major driver of financing risk for new gas plants.
• Some argue overbuilding renewables and relying on market price signals will sort out storage; others warn that pure-market approaches can underbuild reliability and require explicit capacity payments or regulation.
• There is concern that as renewables depress spot prices toward zero, investment signals for new generation become cloudy unless markets separately value capacity and grid services.

Grid Architecture Analogies & Technology Enablers

• Multiple comments liken the grid to a memory hierarchy:
  • Batteries as cache/RAM, pumped hydro or gas as “tape,” different siting (co-located vs merchant) as different cache levels.
• Power electronics (MOSFETs, IGBTs) and modern inverters are highlighted as key enablers of grid-scale batteries and HVDC links.
• HVDC is already being deployed and modeled as a way to move large amounts of power efficiently over long distances and smooth regional variability.