Four-hour batteries cheaper than open-cycle gas turbines in 43 markets, study finds

AI data-center developers are driving up prices for gas turbines, but a new Wood Mackenzie report points to a cheaper alternative for the type many favor. Four-hour battery storage costs less than open-cycle gas turbines in all 43 markets surveyed, across every continent, according to TechCrunch’s account of the findings.

The gas option is getting more expensive

The buying rush is part of the comparison’s immediate relevance to AI infrastructure. TechCrunch reports that developers have been purchasing available gas-turbine models, pushing equipment prices higher. The pressure has been especially acute for open-cycle turbines, which are more readily available than closed-cycle equipment.

That relative availability comes with a tradeoff: open-cycle turbines are less efficient and more expensive to operate. Utilities often use them as peaking plants—generators that supply electricity during periods of high demand. Higher turbine prices can therefore raise utilities’ costs, too, rather than affecting only developers building power for their own facilities.

Simpler manufacturing has not spared open-cycle equipment from long delivery queues. Closed-cycle turbine waitlists extend into the early 2030s, and backlogs for both types have been pushing up prices for new natural-gas power plants.

A specific comparison, not every power choice

Wood Mackenzie’s finding is broad geographically but specific technologically. It compares four-hour battery storage with open-cycle gas turbines. It should not be read as a finding that batteries are cheaper than every kind of gas generation, or that this storage duration answers every data center’s power needs.

The report also places the storage finding alongside a separate generation comparison: solar is the cheapest form of new power in every market surveyed. The two findings concern different categories—battery storage and new electricity generation—rather than a single ranking of interchangeable power sources.

The consultancy expects the gap to widen

Wood Mackenzie forecasts that electricity costs from batteries will keep falling, while those from gas turbines will rise over the coming decades.

In the Middle East and Africa, the consultancy expects four-hour batteries to become 33% cheaper by 2035, displacing gas peaking power on cost across the region’s gas markets.