A new report from the industry tracker Clean Investment Monitor projects that U.S. battery manufacturers should be able to meet the domestic demand coming from energy storage and electric mobility customers by 2030.
As the U.S. slaps tariffs on Chinese batteries and electric vehicles, domestic production of the key components for both electricity power storage and electric vehicles is ramping up.
Since 2018, investors and businesses hve committed to build $166 billion in battery and cell module manufacturing plantss. In the last six years $55 billion has already poured into new manufacturing capacity for battery cells and modules.
All of that new construction means up to 1,288 GWh of cells and modules will be churning out of American factories by 2030.
As the Clean Investment Monitor report indicates, all of this supply is more than enough to meet projected demand from companies through the end of the decade.
Whether any of this will matter to developers is an open question. Chinese companies dominate the lithium ion battery market and are projected to have the largest market share through the end of the decade, according to a report from McKinsey & Co.
And Chinese batteries may remain the cheapest options on the market despite U.S. tariffs. Curent battery prices were hovering around $139 per kWh in 2023, down from $780 per kWh just a decade ago. CATL could halve the price of its batteries this year, in a move that would make Chinese-made batteries competitive despite tariff increases from the U.S. government.
While U.S. automakers will likely buy from domestic manufacturers to reap the benefits of the tax credits offered through the Inflation Reduction Act and the Bipartisan Infrastructure Law, developers using batteries for energy storage to smooth power grids and store variable renewable power may be convinced by the lower prices.
It’s the same tension that solar panel manufacturers face, where Chinese manufactured solar cells are now 20 cents cheaper on the global market than comparable panels in the U.S.
Still, the U.S. can’t afford to be reliant on China’s manufacturing muscle in an era where energy storage technologies are ascendant — and central to the energy transition across all industries.