Wood Mackenzie’s comparison gives battery storage an important cost advantage over open-cycle gas turbines in all 43 markets it surveyed. That matters because open-cycle turbines are the fast-starting plants often used for peak demand, and data-center developers have been competing for scarce equipment. The conclusion is narrower than “batteries replace gas”: four-hour storage shifts electricity across the day but does not create energy during a long grid outage.
Storage attacks the expensive hours
A battery can charge when wholesale power is cheaper and discharge during peaks, avoiding fuel consumption and turbine starts. It can also be deployed modularly, while the source reports procurement times of two to four years for open-cycle turbines and waits into the early 2030s for combined-cycle equipment. For a data-center project, shortening the path to usable power can be as valuable as lowering the levelized cost.
Lazard’s 2026 LCOE+ work reaches a compatible but qualified conclusion: storage economics depend on use case, duration, charging cost and capacity value. A four-hour system serving daily peaks is not economically equivalent to a gas plant that can run as long as fuel is available. Developers also need interconnection rights, transformers and a source of electricity to charge the battery.
The likely architecture is layered, not binary
Data centers require high availability. A practical system can combine grid supply, batteries for short peaks and ride-through, and some form of longer-duration backup. Solar paired with storage can lower energy cost, but weather and overnight demand create a residual requirement. Gas loses share first where it is used infrequently at the margin, not necessarily where it provides multi-day resilience.
What investors should watch
For investors, the opportunity sits across storage cells, power electronics, engineering and grid equipment; it should not be assigned automatically to any single stock without contract evidence. The measurable signal is whether hyperscalers sign storage-backed power agreements and disclose achieved uptime and cost, not whether a consultancy’s global average favors batteries.
BTI's bottom line
The report strengthens the case for storage in data-center power stacks while leaving firm-power economics unresolved.