Summary
Wood Mackenzie’s 2026 electricity-cost analysis says four-hour battery storage has a lower modeled levelized cost than open-cycle gas turbines in all 43 markets where both were assessed. The comparison concerns electricity costs, not the purchase prices of batteries and turbines.
Wood Mackenzie’s latest global levelized cost of electricity analysis finds that four-hour battery storage is less costly than open-cycle gas turbines in all 43 markets where the consultancy modeled both technologies. The report, released on 8 October 2026, frames the result as a comparison of modeled electricity costs—not a comparison of equipment purchase prices.
That distinction matters because batteries and gas turbines provide power differently. A battery stores electricity for later use; an open-cycle gas turbine generates electricity by burning gas. A four-hour storage system has enough stored energy to discharge at its rated power for four hours. Whether it can replace a peaker in a particular power system also depends on the timing and duration of demand, charging conditions and reliability needs.
What the cost comparison measures
Levelized cost of electricity (LCOE) expresses modeled costs per unit of electricity over a project’s life. Wood Mackenzie uses the measure to compare technologies, but the release does not provide the underlying calculation assumptions. Its headline result is limited to the 43 markets where both battery storage and open-cycle gas turbines were included in the analysis.
The comparison is therefore a signal about the economics of short-duration storage relative to gas peaking in those markets. It is not a claim that the technologies have identical operating capabilities or that a four-hour battery can supply power for as long as a fuelled plant.
Regional figures show different cost paths
In the Middle East and Africa, Wood Mackenzie puts four-hour grid-scale storage at US$120/MWh in 2026 and forecasts a 33% decline to US$80/MWh by 2035. It says storage is already cheaper than gas peaking across every gas market in the region. Utility-scale solar is also a low-cost source there: the report gives a regional LCOE of US$37/MWh in 2026, falling to US$24/MWh by 2035.
China is the benchmark for grid-scale storage costs in Asia Pacific. Wood Mackenzie says its cost level is more than 55% below the rest of the region’s average of US$134/MWh. It forecasts that competitive Chinese supply will help pull the rest-of-region average down to US$92/MWh by 2036.
The report also describes pressure on gas-generation economics in North America. It links data-centre load growth to a supply-deficit cycle for investment in gas generation capacity through the late 2030s, keeping thermal capital costs elevated. That regional finding adds context to the storage comparison, but it does not mean the report establishes that batteries are being used in place of gas turbines at data centres.