China’s power market overhaul and data-centre boom set off a global rush for battery storage

Global Battery Storage Demand Surges as China Revamps Power Market

Written by: Supriya Kadu

Edited by: Pinky Deshmukh

Last Updated: December 22, 2025

Summary: China’s power reforms and rising data-centre demand are accelerating global investment in battery storage systems.

China's dramatic changes to its electricity market are quietly changing the global energy landscape, with one obvious result: a huge increase in worldwide demand for battery storage. As electricity pricing becomes more market-driven and data centres multiply to support artificial intelligence and cloud computing, batteries are emerging as a critical piece of the puzzle.

Earlier this year, China began rolling out reforms that allow new energy-storage projects to sell electricity through competitive market auctions instead of relying on fixed tariffs. This shift has made battery projects much more appealing to investors. Operators can now store power at a low cost and release it as demand (and prices) increase, enhancing profitability and accelerating adoption.

At the same time, the rapid growth of AI-powered data centres is reshaping global electricity usage. These facilities require round-the-clock, reliable power, and even brief disruptions can be costly. Battery storage provides an immediate backup and smooths power supply during peak consumption, making it a necessary expenditure rather than an optional add-on.

The ripple effects extend far beyond China. Chinese battery makers, which are already dominating in the global supply chain, are experiencing an increase in orders from Europe, the Middle East, and portions of Asia. Analysts estimate global battery shipments could rise dramatically over the next year as utilities, tech companies and governments race to secure storage capacity.

Renewable energy plays a key role. As more countries rely on solar and wind power, the demand for batteries increases because these sources are subject to weather and shifting demand. Without storage, a lot of excess clean energy goes to waste. Batteries allow you to store electricity and use it later, when you need it the most.

China's contribution is crucial due to its magnitude. Many of the world's largest battery manufacturers are headquartered in the country, and its policies have a considerable impact on global pricing and supply. What began as a domestic power reform is now helping accelerate a worldwide shift toward smarter, more flexible energy systems.

As data centres grow larger and clean-energy targets become more ambitious, experts expect battery storage to move from the sidelines to the centre of global energy planning — with China’s reforms acting as a major catalyst for that change.