Batteries have never been cheaper, so why is storage still waiting for its share of money?

South Africa’s Hex Battery Energy Storage system. Source: AfDB/Flickr

For most of the past decade, the question about energy storage was whether it would ever be affordable. That question has been answered.

Stationary battery packs fell to around $70/kWh in 2025, down 45% year on year, according to BloombergNEF. Africa installed an estimated 17GW of solar in 2026, a 45% rise on the year before, according to energy think tank Ember. And in South Africa, more than 90% of residential solar systems now sold include a battery system.

Yet of the $13.84 billion in energy transition investment Africa attracted in 2025, as tracked by Electron Intelligence, just $666 million, under 5%, went to storage and flexibility.

That gap, between how cheap storage has become and how slowly it is being financed, protected and integrated into grid planning, runs through the latest ESI Africa Industry Insights Volume into Energy & Storage.

According to Nicolette Pombo-van Zyl, Editor-in-Chief of ESI Africa, storage has stopped being the add-on that gets bolted onto a renewable project at the end. “It is now the part that decides whether a project gets financed, whether a grid stays stable after sunset and whether the clean energy already being generated is actually used. The industry’s challenge is that capital, regulation and data have not yet caught up with that reality,” says Pombo-van Zyl.

Comparative modelling in South Africa puts lithium iron phosphate (LFP) ahead of every rival chemistry for stationary storage, with a levelised cost of storage of about R4.05 to R4.25 per kilowatt-hour (kWh). Paired with solar PV, it delivers electricity at around R1.92/kWh, undercutting gas turbine peaking at R7.07/kWh.

But the ESI Africa volume shows that battery chemistry is only the start of the pricing. Deployment scale, physical degradation in hot climates and the cost of capital decide whether that advantage survives a real project. Import tariffs and freight can inflate storage capital costs by 15 to 35% across emerging markets.

A companion feature maps the chemistry landscape beyond LFP, from sodium-ion, which removes lithium from the equation and is now entering utility tenders in India, to LMFP, lithium manganese-rich and solid-state batteries. Its takeaway for a minerals-rich continent points to a threat that the cheapest battery chemistry may use less of the minerals Africa wants to move up the value chain.

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The Volume is published in partnership with Envusa Energy, NOA Group and Lyra Energy.