Latin America's energy storage market to grow 13-fold by 2035, from 2.5 GW to 34 GW

Latin America’s energy storage market is entering a period of rapid and sustained expansion. Wood Mackenzie’s Latin America energy storage outlook 2026 projects cumulative capacity will grow from 2.5 gigawatts (GW) in 2025 to 34 GW by 2035, a compound annual growth rate (CAGR) of 30%. Accelerating tender activity, rising renewable curtailment and unmodernized transmission infrastructure are the primary forces behind this growth. 

“Latin America is no longer a frontier market for energy storage, it is an active one. The pipeline is growing fast, but deployment stalls without comprehensive regulatory frameworks with clear remuneration mechanisms” said Pamela Morales at Wood Mackenzie. 

Chile remains the regional leader and holds the largest operational BESS projects in Latin America. High curtailment continues to drive investment in longer-duration systems. However, price cannibalisation in the northern grid is an emerging risk, eroding arbitrage revenues as more storage enters the market. 

Mexico’s market is at a policy-driven inflection point. Recent enabling mechanisms — including the first priority call for proposals and the joint development call with Mexico’s Federal Electricity Commission (CFE), both with mandatory storage — are expected to award more than 3 GW of storage capacity by 2030.  

Brazil’s storage market is poised for a significant step forward. A dedicated battery tender, scheduled for December 2026, will drive capacity additions from 2028 onwards. However, without clear remuneration mechanisms, project financing will remain challenging in the near term. 

Argentina has moved quickly to build a standalone storage market through tender activity. Recent rounds awarded a combined 1.3 GW of standalone storage. Operations are set to begin in 2027, providing critical transmission support.  

The Dominican Republic offers the most structured regulatory framework in the Caribbean. A 50% storage-to-solar capacity mandate drives near-term deployment, with the government targeting 500 megawatts (MW) by 2030. 

Deployment across Latin America remains constrained by the absence of bankable revenue mechanisms and clear regulatory frameworks. Most markets lack defined remuneration for ancillary services and energy arbitrage, making long-term bankability difficult. Restricted financing, permitting delays and limited offtakers compound the challenge.  

“Latin America still needs to find a balance between mandates and incentives to develop the market. Countries that build bankable revenue frameworks will attract the investment needed to sustain growth well beyond the current policy-driven wave” said Morales. “The next decade will separate markets that merely announce capacity from those that successfully deliver it.”