BESS is emerging as a rare bright spot despite erratic trade wars and an increasingly unfavorable regulatory environment plaguing the broader clean energy industry. New BESS capacity achieved record growth across the US in the second quarter, even as solar and wind additions slagged.

BESS capacity additions jumped to 4.9 GW last quarter, more than tripling the prior quarter and up 69% from the same quarter last year, according to the American Clean Power Association. It marked the highest quarter for BESS installations to date and brought operational capacity to over 35 GW.  46 BESS projects across 13 states, led by Arizona, California and Texas, came online in Q2.

BESS has become more attractive for both economic and policy reasons. The growing penetration of renewables – especially in ERCOT and CAISO – has caused greater price volatility, which leads to better arbitrage opportunities for BESS assets. On the policy front, the OBBBA spared BESS from the rollback of federal subsidiaries, extending federal support for the technology through 2036.

The bill’s impact on solar and wind, meanwhile, are coming to light. US solar capacity additions in the second quarter dropped by 19% from the same quarter in 2024, reaching about 5,700 MW. On-shore wind deployments plunged 30%, reaching just over 1,010 MW.

“The uncertainty created by new bureaucratic delays and unclear demands is having a chilling effect on the pipeline for future energy projects, stalling growth precisely when our nation needs more energy to power a growing economy,” said ACP CEO Jason Grumet in a statement.

BESS was not completely spared from the headwinds, however. The BESS project pipeline shrank by 6% over the quarter. This comes after BESS saw an average quarterly growth rate of 11% over the last two years. BESS also faces stringent sourcing requirements from the OBBBA, with restrictions on the share of project components that can come from select countries including China, which dominates the global clean energy supply chain.  

The PPA market also experienced fallout. PPA capacity over the first half of 2025 slid by 32% from the year-ago period. Wind PPA and BESS offtake announcements quarter-over-quarter this year fell 93% and 88%, respectively.

Pexapark’s BESS TB2 valuations, which measure energy-only arbitrage excluding ancillary revenues, have been trending up in ERCOT over the past 12 months. The ERCOT composite TB2 (7-year term, 2027 start, persistent revenue model) has gained more than 20%.