Grid-scale battery storage projects slated for 2026 commercial operation face mounting delays as the U.S. interconnection queue has swelled to approximately 2,600 gigawatts of proposed generation and storage capacity, with no near-term resolution in sight. Federal regulators are racing to finalize new rules, but structural backlogs, high project attrition, and transmission infrastructure gaps continue to erode developer confidence and stall the storage pipeline utilities need to meet rising peak demand.
Background
The U.S. interconnection queue has become the defining bottleneck for clean energy deployment. As of the end of 2023, an estimated 2,600 GW of proposed generation and storage projects were awaiting grid access, with typical wait times stretching to five years or more. More than 95% of that queued capacity consists of zero-carbon resources, including solar (1,080 GW), battery storage (1,030 GW), and wind (366 GW).
The backlog has structural roots. A legacy first-come, first-served process allowed speculative facilities to occupy queue positions ahead of construction-ready projects, incentivizing "queue clogging" and slowing progress. The time from initial request to commercial operation has grown from under two years in 2008 to nearly five years in 2023.
FERC's Order 2023, issued in July 2023, sought to address the problem by replacing serial study processes with a cluster-based, "first-ready, first-served" approach. The reforms require projects to meet stricter site control requirements, pay higher deposits, and face withdrawal penalties designed to discourage speculative applications. Implementation has been uneven, however. On July 24, 2025, FERC ordered PJM Interconnection to make significant changes to its compliance plan, which set baseline requirements for grid interconnection rules including the cluster study approach and other reforms intended to reduce the backlog.
Details
The latest market data indicate the bottleneck is suppressing new project entries even as deployment records are set. BloombergNEF's 2026 Sustainable Energy in America Factbook confirms 2025 as a record year for U.S. utility-scale storage at 15.2 GW added. Yet the forward pipeline is cooling: while total interconnection applications hit 377 GW across the seven major U.S. ISOs, applications for new storage interconnections declined 20% year-on-year, partly due to grid operator pauses, permitting hurdles, and delays.
Regional backlogs illustrate the geographic scope of the problem. In PJM, transition queue reforms begun in 2022-23 have started to clear a backlog, but more than 60 GW remain under study for 2026. In MISO, over 170 GW of solar, wind, and storage await interconnection, with many projects facing delays of four or more years.
Attrition rates have reached alarming levels. Nearly 80% of new projects withdraw, primarily due to unpredictable, multi-year delays and prohibitively high grid upgrade costs. Lawrence Berkeley National Laboratory research shows interconnection wait times have more than doubled over the past fifteen years. Of all capacity that submitted interconnection requests between 2000 and 2019, only 13% had reached commercial operation by the end of 2024, while 77% had withdrawn.
Lawrence Berkeley National Laboratory's annual interconnection review, published in December 2025, found that queue capacity dropped for the first time in 2024-but not solely due to increased efficiency. Although record amounts of large-scale solar (31 GW) and battery storage (11 GW) completed interconnection and began operating, new solar and battery storage capacity entering the queue declined sharply alongside a rise in withdrawals.
On the regulatory front, the U.S. Department of Energy on October 23, 2025, invoked a rarely used authority under Section 403 of the DOE Organization Act to direct FERC to initiate rulemaking to accelerate and standardize the interconnection of large loads. Underscoring the urgency, the DOE directed FERC to issue a final rule by April 30, 2026. Meanwhile, project-level M&A has accelerated as buyers prioritize de-risked assets. Approximately 45 reported energy storage project M&A transactions occurred during the first nine months of 2025, compared to roughly 22 during the same period in 2024, driven by buyer preference for confirmed interconnection, permitting, and offtake.
Outlook
Analysts note that the primary bottleneck is shifting from the study process itself to permitting and supply chains for physical infrastructure such as high-voltage transformers. Even with faster study approvals, projects remain stalled-reinforcing the view that a national commitment to expanding the grid, not just managing its queue, is the only long-term solution. Grid Strategies' November 2025 report forecasts that meeting the historic electricity demand surge will require more than 150 GW in additional capacity within five years, by 2030. Whether FERC's Order 2023 compliance actions and the DOE-directed large-load rulemaking can sufficiently accelerate the storage pipeline to meet that timeline remains the central question facing developers, utilities, and regulators.
For background on how a specific project navigated these challenges, see the earlier report on the Trego 200MW BESS near Reno1Trego 200MW BESS near Reno.
