Battery energy storage systems (BESSes) are increasingly being adopted to improve efficiency and stability in power distribution networks. By storing energy from both renewable sources, such as solar and wind, and the conventional power grid, BESSes balance supply and demand, stabilizing power grids and optimizing energy use.
This article examines emerging trends in BESS applications, including advances in battery technologies, the development of hybrid energy storage systems (HESSes), and the introduction of AI-based solutions for optimization.
Battery technologies
Lithium-ion (Li-ion) is currently the main battery technology used in BESSes. Despite the use of expensive raw materials, such as lithium, cobalt, and nickel, the global average price of Li-ion battery packs has declined in 2025.
BloombergNEF reports that Li-ion battery pack prices have fallen to a new low this year, reaching $108/kWh, an 8% decrease from the previous year. The research firm attributes this decline to excess cell manufacturing capacity, economies of scale, the increasing use of lower-cost lithium-iron-phosphate (LFP) chemistries, and a deceleration in the growth of electric-vehicle sales.
Using iron phosphate as the cathode material, LFP batteries achieve high energy density, long cycle life, and good performance at high temperatures. They are often used in applications in which durability and reliable operation under adverse conditions are important, such as grid energy storage systems. However, their energy density is lower than that of traditional Li-ion batteries.
Although Li-ion batteries will continue to lead the BESS market due to their higher efficiency, longer lifespan, and deeper depth of discharge compared with alternative battery technologies, other chemistries are making progress.
Flow batteries
Long-life storage systems, capable of storing energy for eight to 10 hours or more, are suited for managing electricity demand, reducing peaks, and stabilizing power grids. In this context, “reduction-oxidation [redox] flow batteries” show great promise.
Unlike conventional Li-ion batteries, the liquid electrolytes in flow batteries are stored separately and then flow (hence the name) into the central cell, where they react in the charging and discharging phases.
Flow batteries offer several key advantages, particularly for grid applications with high shares of renewables. They enable long-duration energy storage, covering many hours, such as nighttime, when solar generation is not present. Their raw materials, such as vanadium, are generally abundant and face limited supply constraints. Material concerns are further mitigated by high recyclability and are even less significant for emerging iron-, zinc-, or organic-electrolyte technologies.
Flow batteries are also modular and compact, inherently safe due to the absence of fire risk, and highly durable, with service lifetimes of at least 20 years with minimal performance degradation.
The BESSt Company, a U.S.-based startup founded by a former Tesla engineer, has unveiled a redox flow battery technology that is claimed to achieve an energy density up to 20× higher than that of traditional, vanadium-based flow storage systems.
The novel technology relies on a zinc-polyiodide (ZnI2) electrolyte, originally developed by the U.S. Department of Energy’s Pacific Northwest National Laboratory, as well as a proprietary cell stack architecture that relies on undisclosed, Earth-abundant alloy materials sourced domestically in the U.S.
The company’s residential offering is designed with a nominal power output of 20 kW, paired with an energy storage capacity of 25 kWh, corresponding to an average operational duration of approximately five hours. For commercial and industrial applications, the proposed system is designed to scale to a power rating of 40 kW and an energy capacity of 100 kWh, enabling an average usage time of approximately 6.5 hours.
This technology (Figure 1) is well-suited for integration with solar generation and other renewable energy installations, where it can deliver long-duration energy storage without performance degradation.
Sodium-ion batteries
Sodium-ion batteries are a promising alternative to Li-ion batteries, primarily because they rely on more abundant raw materials. Sodium is widely available in nature, whereas lithium is relatively scarce and subject to supply chains that are vulnerable to price volatility and geopolitical constraints. In addition, sodium-ion batteries use aluminum as a current collector instead of copper, further reducing their overall cost.
Blue Current, a California-based company specializing in solid-state batteries, has received an $80 million Series D investment from Amazon to advance the commercialization of its silicon solid-state battery technology for stationary storage and mobility applications. The company aims to establish a pilot line for sodium-ion battery cells by 2026.
Its approach leverages Earth-abundant silicon and elastic polymer anodes, paired with fully dry electrolytes across multiple formulations optimized for both stationary energy storage and mobility. Blue Current said its fully dry chemistry can be manufactured using the same high-volume equipment employed in the production of Li-ion pouch cells.
Sodium-ion batteries can be used in stationary energy storage, solar-powered battery systems, and consumer electronics. They can be transported in a fully discharged state, making them inherently safer than Li-ion batteries, which can suffer degradation when fully discharged.
Aluminum-ion batteries
Project INNOBATT, coordinated by the Fraunhofer Institute for Integrated Systems and Device Technology (IISB), has completed a functional battery system demonstrator based on aluminum-graphite dual-ion batteries (AGDIB).
Rechargeable aluminum-ion batteries represent a low-cost and inherently non-flammable energy storage approach, relying on widely available materials such as aluminum and graphite. When natural graphite is used as the cathode, AGDIB cells reach gravimetric energy densities of up to 160 Wh/kg while delivering power densities above 9 kW/kg. The electrochemical system is optimized for high-power operation, enabling rapid charge and discharge at elevated C rates and making it suitable for applications requiring a fast dynamic response.
In the representative system-level test (Figure 2), the demonstrator combines eight AGDIB pouch cells with a wireless battery management system (BMS) derived from the open-source foxBMS platform. Secure RF communication is employed in conjunction with a high-resolution current sensor based on nitrogen-vacancy centers in diamond, enabling precise current measurement under dynamic operating conditions.
Li-ion battery recycling
Second-life Li-ion batteries retired from applications such as EVs often maintain a residual storage capacity and can therefore be repurposed for BESSes, supporting circular economy standards. In Europe, the EU Battery Passport—mandatory beginning in 2027 for EV, industrial, BESS (over 2 kWh), and light transport batteries—will digitally track batteries by providing a QR code with verified data on their composition, state of health, performance (efficiency, capacity), and carbon footprint.
This initiative aims to create a circular economy, improving product sustainability, transparency, and recyclability through digital records that detail information about product composition, origin, environmental impact, repair, and recycling.
HESSes
A growing area of innovation is represented by the HESS, which integrates batteries with alternative energy storage technologies, such as supercapacitors or flywheels. Batteries offer high energy density but relatively low power density, whereas flywheels and supercapacitors provide high power density for rapid energy delivery but store less energy overall.
By combining these technologies, HESSes can better balance both energy and power requirements. Such systems are well-suited for applications such as grid and microgrid stabilization, as well as renewable energy installations, particularly solar and wind power systems.
Utility provider Rocky Mountain Power (RMP) and Torus Inc., an energy storage solutions company, are collaborating on a major flywheel and BESS project in Utah. The project integrates Torus’s mechanical flywheel technology with battery systems to support grid stability, demand response, and virtual power plant applications.
Torus will deploy its Nova Spin flywheel-based energy storage system (Figure 3) as part of the project. Flywheels operate using a large, rapidly spinning cylinder enclosed within a vacuum-sealed structure. During charging, electrical energy powers a motor that accelerates the flywheel, while during discharge, the same motor operates as a generator, converting the rotational energy back into electricity. Flywheel systems offer advantages such as longer lifespans compared with most chemical batteries and reduced sensitivity to extreme temperatures.
This collaboration is part of Utah’s Operation Gigawatt initiative, which aims to expand the state’s power generation capacity over the next decade. By combining the rapid response of flywheels with the longer-duration storage of batteries, the project delivers a robust hybrid solution designed for a service life of more than 25 years while leveraging RMP’s Wattsmart Battery program to enhance grid resilience.
AI adoption in BESSes
By utilizing its simulation and testing solution Simcenter, Siemens Digital Industries Software demonstrates how AI reinforcement learning (RL) can help develop more efficient, faster, and smarter BESSes.
The primary challenge of managing renewable energy sources, such as wind power, is determining the optimal charge and discharge timing based on dynamic variables such as real-time electricity pricing, grid load conditions, weather forecasts, and historical generation patterns.
Traditional control systems rely on simple, manually entered rules, such as storing energy when prices fall below weekly averages and discharging when prices rise. On the other hand, RL is an AI approach that trains intelligent agents through trial and error in simulated environments using historical data. For BESS applications, the RL agent learns from two years of weather patterns to develop sophisticated control strategies that provide better results than manual programming capabilities.
The RL-powered smart controller continuously processes wind speed forecasts, grid demand levels, and market prices to make informed, real-time decisions. It learns to charge batteries during periods of abundant wind generation and low prices, then discharge during demand spikes and price peaks.
The practical implementation of Siemens’s proposed approach combines system simulation tools to create digital twins of BESS infrastructure with RL training environments. The resulting controller can be deployed directly to hardware systems.
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