San Antonio's public utility, CPS Energy, has partnered with OCI Energy to begin construction on a 120-megawatt battery storage system in southeastern Bexar County, a move designed to bolster grid reliability amid increasing outage durations and rising electricity demand. The Alamo City Battery Energy Storage System (BESS) will charge during periods of low demand and discharge when power needs peak, providing a flexible resource for the utility.
The project's timing is critical: CPS Energy's internal data shows the average customer outage duration climbed to 75.38 minutes in 2025, exceeding the utility's target of 64.15 minutes. Contributing factors include more frequent severe storms, equipment failures, and safety-related circuit shutdowns. While the battery cannot prevent outages from downed power lines, it offers CPS a dispatchable tool to manage stress on the grid during high-demand hours, such as hot summer afternoons when air conditioning usage spikes.
The facility is rated at 120 MW of output with 480 megawatt-hours of storage capacity, allowing it to discharge at full power for approximately four hours. According to the companies, this is enough to serve roughly 30,000 homes for up to four hours. Commercial operation is expected to begin in 2027.
OCI Energy will own the project under a long-term storage capacity agreement with CPS Energy, which will retain operational control. ING is providing construction financing, LG Energy Solution Vertech is supplying the battery technology, and Elgin Power Solutions serves as the engineering, procurement, and construction contractor. Sabah Bayatli, president of OCI Energy, stated that the system will help the electric grid "better manage peak demand events," while CPS Energy CEO Rudy D. Garza emphasized that storage gives the utility "flexibility to meet growing demand."
Industry executives highlighted the project's role in building resilient infrastructure. Sven Wellock, ING's head of renewables and power for the Americas, called it "real, resilient infrastructure," and Jaehong Park, CEO of LG Energy Solution Vertech, noted it will help "ease demand constraints." For OCI Holdings, the Korea-based parent company, the San Antonio project represents a strategic shift toward retaining equity and directly operating renewable assets, rather than selling projects before completion, as reported by BusinessKorea.
CPS Energy has been expanding its storage portfolio beyond this project. In 2024, the utility signed storage capacity agreements with Eolian for 350 MW, building on an earlier 50 MW deal. Additionally, CPS recently broke ground with Ashtrom Renewable Energy on the El Patrimonio solar project in Bexar County. These moves align with broader trends in Texas, where the U.S. Energy Information Administration forecasts that utility-scale solar generation in ERCOT will surpass coal in 2026, with solar output reaching 78 billion kilowatt-hours versus 60 billion for coal. The increasing share of solar power amplifies the value of battery storage to shift energy from sunny hours to evening peak demand.
Texas has emerged as a national leader in battery deployment. A February presentation by the Texas Solar + Storage Association to ERCOT reported that installed and operating battery capacity had reached 15,712 MW, with over 6,000 MW added in the prior year. At times, batteries have supplied as much as 10% of Texas' power needs.
Despite these advances, battery storage alone cannot resolve all outage issues. CPS Energy attributed its longer outage durations to 14 major storm events in 2025, up from 10 in 2024, along with conductor failures, underground cable issues, and pole damage. The utility also de-energized circuits during planned and emergency work to protect workers and the public. Elaina Ball, CPS Energy's chief strategy officer, told board members that the utility experienced "more storms than we forecast," according to the San Antonio Report. CPS is also investing in tree trimming, infrastructure upgrades, and reliability programs to mitigate weather-related impacts.
In summary, the Alamo City BESS provides a valuable but targeted solution: a new source of flexible capacity to address peak demand, but not a panacea for local distribution failures. For CPS customers, the real test will come when the battery is operational, demand is high, and the next storm season arrives.
