Latin America's energy storage market to reach 23 GW by 2034

The Latin American region will see a compound annual growth rate of 8% for its energy storage market through 2034, reaching a total of 23 gigawatts (GW), according to Wood Mackenzie’s Latin America Energy Storage Outlook 2025.   

Chile is leading storage capacity installations, followed by Mexico and Dominican Republic, according to the report. “Chile's regulatory policies have positioned the country as the most advanced in energy storage, representing nearly half of the region's total capacity by 2034,” said Pamela Morales, Research Analyst at Wood Mackenzie. “Mexico has great potential to continue advancing in this market, but it’s facing some regulatory barriers. For its part, the Dominican Republic has shown rapid growth.” 

The utility-scale segment will dominate the market over the forecast period, with projects taking different approaches based on regional needs. Standalone utility-scale projects are providing grid stability across Central America and the Caribbean, while high solar penetration is driving solar-paired projects in Mexico and South America. The commercial and industrial (C&I) sector has potential to be developed in certain countries by the mid-2030s. 

Key drivers  

Renewable energy targets and rising curtailment levels are driving significant momentum for energy storage deployment across LatAm. Regional tender adoption has proven highly successful in incentivizing storage, while grid constraints from higher renewable penetration require BESS for stability. This trend is further reinforced by updated energy plans across multiple countries that now incorporate long-term storage targets as a foundational step in energy storage development. 

Persistent challenges despite growth 

However, the region faces regulatory gaps that could slow this momentum. “BESS deployment stalls without comprehensive storage regulatory frameworks, operating models, and remuneration mechanisms for each market segment,” said Morales at Wood Mackenzie. Additionally, upfront costs remain an economic barrier in some markets, though this is expected to change as more participants enter. Infrastructure limitations also create both opportunities and constraints for storage deployment. 

“The LatAm market still needs to find a balance between policies and incentives to keep growing. Long-term success depends on developing comprehensive regulatory frameworks and reducing deployment barriers across all market segments,” added Morales.