Cities are the heartbeat of modern energy demand. During peak periods, metropolitan areas draw the highest electricity loads, straining infrastructure and forcing utilities to rely on costly fossil fuels to meet electrical demand.
As the need for peak-load offset grows, battery energy storage systems (BESS) have become a critical solution. And today, they’re going vertical, and for good reasons.
Utilities have discovered that putting battery storage close to cities is a smart way to meet increasing demand. The grid becomes more stable, electricity reaches its destination with less energy loss, and utilities are better equipped to handle demand surges.
As a result, private energy companies are developing BESS to assist utility companies in meeting increased energy demand. BESS systems buy power from the utility and then sell it back to the utility companies during peak demand.
Urban BESS installations also support municipal climate goals by integrating clean energy and reducing dependence on fossil fuels. And municipalities benefit from reduced emissions during peak hours, which can improve air quality and public health.
In the past, these battery systems were installed horizontally, in containerized units on sprawling plots of land.
But “the open land required for traditional field installations simply isn’t available near urban cores, forcing developers to build upward,” says Eric Svahn, principal at architecture firm SGA. “Going vertical is a novel approach, and many municipalities haven’t yet encountered it or had it presented to them.”
Svahn, whose team has been contracted for the design-build of a vertical BESS in Boston, stresses that urban settings also require energy storage close to substations for efficient energy distribution.
“Utilities are trying to figure out how to better manage their costs for the infrastructure. They have found that the best place for private energy companies to build BESS is in proximity to or next to an existing substation,” he says. “The closer it is, the more economical it is to move power, and the more economical it is for the utility to build the infrastructure.”
Several U.S. cities have already begun piloting vertical BESS projects. For instance, Boston and New York have explored rooftop and multi-story storage near substations to manage peak energy demand and support renewable integration.
“Campus institutions or owners looking to move toward sustainability could do this as well. With energy codes changing, mechanical systems are now required to be all electrical, so all equipment can all on be renewable energy and not rely on fossil fuels,” Svahn advises.
Hospitals, universities and data centers also benefit. By keeping critical infrastructure online during outages, vertical BESS systems enhance resilience, especially in dense urban cores where backup diesel generators may be constrained by space, emissions or noise restrictions.
A BESS does not create energy; it redistributes it.
Svahn explains a BESS draws electricity from the grid and stores it in the batteries when electrical demand and electricity prices are low. It then discharges that stored energy back to the grid when demand and prices are higher. Utilities benefit because the batteries help smooth out peak demand spikes, reducing the need for costly infrastructure upgrades.
In a vertical BESS, batteries, each weighing around 22,000 pounds, are mounted in racks stacked across floors. Power flows from the DC batteries to inverters, which convert it to AC and then step it up through transformers to feed the grid efficiently.
“The layout, the cabling, the stacking all has to be calculated so the system works safely and effectively,” Svahn says.
Structural reinforcement is needed to support the massive weight of batteries and associated equipment.
“The weight of the inverters and transformers is around four times that of a typical office building,” Svahn explains. “So, the structure must be enhanced.”
He stresses that thermal management and fire safety are also crucial.
“The transmission of DC current from the batteries generates a lot of heat,” he explains. “If a battery fails, it can go into what’s called thermal runaway, where the batteries give off CO2 and hydrogen. This concentration of hydrogen without relieving the density buildup of hydrogen is dangerous because hydrogen is very flammable.”
To counteract these concerns, vertical BESS designs put batteries on racks in compartmentalized rooms. Compartmentalization ensures that a failure or a fire in one room does not affect the entire building, a critical factor in urban safety.
CO2 and hydrogen detection, a heat sensing system, ventilation systems and oversized sprinklers tailored to high-hazard environments are also needed. These features allow buildings to safely stack multiple floors of energy storage while minimizing the risk of catastrophic failure.
Coordination with fire departments is also key, Svahn adds.
In fact, this coordination must be part of the design process, with all entities involved providing input on how the fire department will handle a fire emergency.
“The fire department must know what’s going on,” he says. “Some municipalities need to understand the new, evolving codes. And they need training in how to fight a battery fire. Once the chemical cycle begins, there is a point of no return. You will not put it out. With some battery fires, the focus is on cooling and containment to keep the fire in check until it runs its course.”
Site security, limited staffing and municipal zoning also add complexity. The recognition of BESS as a new use group is prompting cities to amend their codes and decide on the safe siting of these installations.
Urban planners must also consider aesthetic impacts. Svahn recommends that vertical BESS buildings be integrated with streetscapes and may need to appear as mixed-use developments, so they blend into city environments without dominating them.
“These buildings look a little mysterious,” he explains. “They typically don’t have any windows, just vents and maybe garage doors on the second floor to load batteries. Residents can get concerned because they see them and don’t understand what’s going on.”
Beyond grid stability, vertical BESS systems advance sustainability. They allow buildings and campuses to integrate renewable energy by storing power generated from solar and wind arrays for later use.
“If you have a large solar field and the sun comes out during the day, that’s great. But if you’re banking on that solar array to provide you with power 24/7, it also needs to store energy. A BESS is a supplement to a renewable energy system,” Svahn says.
These systems also help reduce emissions during peak periods.
“As soon as that spike happens, there’s dirty energy in the grid because they can’t keep up with demand, and they need to fire up the diesel generator,” Svahn explains. “A BESS can shave the peaks and even out the bottom to help keep the grid as clean as possible.”
Looking ahead, battery technology continues to evolve.
“The batteries might get smaller, but they might heat up faster, so they could be more dangerous chemically,” he says. “Or they might become lighter, and then vertical installations can go higher. It’s ever-changing, and that’s the interesting possibility of how to put this all together.”
Eventually, energy storage could integrate with smart grids, AI-driven energy management, and building microgrids, further increasing efficiency and resilience. Facility managers and city planners are seeing the value: stacked batteries save space and open doors to a cleaner, more reliable, and economically efficient energy future.
“The closer it is, the more economical it is to move power, and the more economical it is to build the infrastructure,” Svahn concludes. “It’s about making the city energy system smarter, safer and cleaner.”
As urban energy demand grows and renewable integration becomes essential, vertical BESS systems are poised to transform the landscape of energy infrastructure by stacking power and sustainability in one innovative package.
Ronnie Wendt is a freelance writer based in Minocqua, Wisconsin.
