June 25 (Reuters) - Electric utilities in the U.S. are

increasingly turning to batteries to shift power from periods of

low prices to high-priced ones, according to an analysis from

the U.S. Energy Information Administration.

The strategy, referred to as arbitrage, involves utilities

charging batteries by buying electricity during low-cost periods

and then selling that electricity when electricity prices

increase. Arbitrage is now the primary use case for 10,487 MW of

battery capacity in the U.S., the EIA said.

Energy storage technologies like batteries allow electric

utilities to store power for later use, manage supply and demand

in real time, and help prevent blackouts, among other use cases.

Utilities are also using batteries to bolster electric-grid

reliability, the analysis found. Other instances of battery use

include dealing with excess wind and solar power on the grid.

Electric utilities in the U.S. were operating 575 batteries,

reflecting a total capacity of 15,814 MW, at the end of 2023 --

a figure that the EIA expects will more than triple by the end

of 2028, with another 35,953 MW of battery storage added to the

grid.

In California, for instance, battery storage on the grid has

ramped up dramatically after the state experienced rolling

blackouts during a heat wave in 2020. In 2022, batteries

accounted for 2.4% of generation during the evening hours of

another heat wave, the California Independent System Operator

reported.

Earlier this month, Entergy ( ETR ) and a unit of NextEra

Energy signed an agreement to develop up to 4.5

gigawatts (GW )of new solar and energy storage projects,

expected to provide renewable energy to more than 3 million

customers in Arkansas, Louisiana, Mississippi and Texas.