Peaking plant is the first place where the price of a gas turbine shows up in the price of electricity, and Wood Mackenzie says that point has now been passed everywhere it looks. In its 2026 levelised cost of electricity study, published on 8 October, the consultancy finds four-hour battery storage cheaper than open-cycle gas turbines in all 43 markets in which it modelled both. Its principal analyst Ahmed Jameel Abdullah calls the shift decisive and widening, and names the reasons on the gas side: turbine shortages and more volatile fuel prices are pushing peaking costs up.
The Numbers By Region
The study puts four-hour storage in the Middle East and Africa at US$120/MWh in 2026, falling by a third to US$80/MWh by 2035, enough in Wood Mackenzie's view to beat gas peaking on cost in every gas market of the region. China's storage costs are more than 55 % below the average of the rest of Asia Pacific, which stands at US$134/MWh and is forecast to reach US$92/MWh by 2036. In North America storage costs are forecast to fall 10 % by 2060, while tariffs and trade measures keep solar module prices rising by around 5 % a year to 2030.
Solar with single-axis trackers is the cheapest new generation in 43 of the 48 markets modelled, onshore wind in the other five. Europe has the highest fossil generation costs of any region in the study, and Wood Mackenzie expects carbon costs there to exceed fuel costs by 2030.
Where The Turbines Went
TechCrunch, which reported the study on 9 October, connects it directly to the AI build-out. Data center developers have been buying gas turbines in large numbers, open-cycle machines are the hardest hit, and procurement now takes two to four years; waiting lists for combined-cycle units reach into the early 2030s. The same scarcity that makes on-site turbines attractive to a data center developer has made them an expensive way to cover a few hundred hours of peak demand a year.
What The Comparison Leaves Out
A levelised cost compares a battery and a turbine on the job both can do, which is a few hours of output at the top of the daily curve. It says nothing about the jobs a battery cannot do: a cold, windless week, a long grid outage, a plant that has to run for days on fuel delivered to site. That is still where engines and turbines earn their place, and it is also why many of the new plants are hybrids, with storage taking the fast swings and the daily peak while reciprocating engines or turbines carry the long hours. Reciprocating engines are not part of the comparison as published; the press release covers open-cycle turbines only.
For anyone specifying peaking or balancing plant, the useful reading is the running-hours profile. A plant that will now start less often but run longer when it does is a different machine to cool and maintain than a classic peaker, and the enquiry should say which of the two it is.
Sources: Wood Mackenzie, TechCrunch
