AI Summary
5 min readFor nearly two decades, commercial and industrial (C&I) solar was the dominant segment of the U.S. solar market—until it wasn’t. Residential and utility-scale solar scaled past it, and C&I was left behind. The same pattern has been repeating in energy storage: of the roughly 40 gigawatts of batteries on the U.S. grid as of 2025, about 90% is utility-scale, 10% is residential, and “basically nothing is C&I,” according to Tim Hayden, now a senior vice president at Voltus after his company Brightfield Infrastructure was acquired. But Hayden argues that the economics have shifted over the last 18 months in ways that could finally make C&I storage viable at scale. The key question is whether a market that has historically been an economic “edge case” can finally break out.
Why C&I storage has historically failed
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What you'll learn
- 1 (03:45) **Why C&I Storage Has Historically Sucked** - Tim gives his diagnosis: the market is nascent (most growth in the last 5 years), and 90% of storage added is utility-scale, 10% residential, with essentially zero C&I.
- 2 (08:28) **The Heuristic: What Makes a C&I Customer Bite?** - Tim defines the economic threshold that makes a C&I project worth pursuing.
- 3 (11:29) **The Revenue Side: Four Value Streams That Are Trending Up** - Tim breaks down the four components of the distributed storage value stack that are collectively improving.
- 4 (14:31) **The Root Cause: Peaks Are Getting Peakier** - Shayle connects the first two value streams (TOU arbitrage and demand charges) to a single underlying trend.
- 5 (16:10) **Capacity Markets: The 11X Price Surge and Market Dysfunction** - Tim explains how capacity prices in PJM have exploded and why the market isn't working properly.
- 6 (18:06) **The Counter-Argument: ERCOT and the Cannibalization Problem** - Shayle raises the risk that adding too much storage can erode its own value, using ERCOT as a case study.
- 7 (21:07) **The Cost Side: The IRA and the 40% Hardware Drop** - Tim starts on the cost side, highlighting two massive tailwinds that have arrived in the last 18 months.
+ Full timestamped outline available in the app
Show Notes
Commercial and industrial (C&I) battery storage has long been the missing middle of the energy storage market. It’s been too complex and expensive to scale like residential systems, but too small to compete with utility-scale projects.
That may finally be changing.
In this episode, Shayle sits down with Tim Hade, senior vice president at Voltus and founder of Brightfield Infrastructure, to discuss why C&I storage has historically struggled, why the economics are shifting dramatically, and why the next wave of distributed energy could be driven by commercial customers rather than utilities.
They explore the four revenue streams that are making batteries more valuable, from demand charge management to emerging capacity markets, and examine how declining hardware costs, stable federal tax incentives, and AI-powered automation are reshaping project economics. Tim also explains how aggregating thousands of commercial batteries into virtual power plants could help hyperscalers bring new data centers online faster while easing pressure on an increasingly constrained electric grid.
Shayle and Tim discuss:
- Why commercial battery storage lagged behind residential and utility-scale markets
- The four revenue streams driving today's C&I storage economics
- How rising electricity prices and capacity shortages are changing customer demand
- Why battery hardware costs have fallen by roughly one-third in 18 months
- How AI could reduce project transaction costs by as much as 90%
- The opportunity — and challenge — of aggregating thousands of distributed batteries into virtual power plants
- Why data center growth and "bring your own capacity" programs could accelerate C&I storage adoption
- Tim's outlook for the fastest-growing segment of the battery storage market
Resources
Latitude: Voltus is acquiring energy storage startup Brightfield AI
Latitude: Google is Voltus' first Bring Your Own Capacity
Latitude: Can VPPs unlock grid capacity for data centers?
Catalyst: Battery booms and the rise of flexibility
Latitude: The Off-Grid Data Center Fantasy
Credits: Hosted by Shayle Kann. Produced and edited by Max Savage Levenson. Original music and engineering by Sean Marquand. Stephen Lacey is our executive editor.
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