General Motors is entering the stationary power storage market through a collaboration with startup Peak Energy Technologies.
This move capitalizes on growth driven by artificial intelligence demand and aligns with investor enthusiasm that recently boosted the stock of its rival, Ford (NYSE: F).
At an event in San Francisco on Tuesday, General Motors announced it will work with Peak Energy to develop batteries capable of storing energy for the grid during off-peak hours.
Additionally, the automaker is taking steps to enable its existing consumer electric vehicles to store power for the grid when connected to home chargers.
This initiative could help utility companies manage the electricity demands created by AI data centers.
Both General Motors and Ford have invested tens of billions of dollars in electric vehicles but have faced weaker-than-expected consumer demand in the U.S. market.
Now, following Ford's lead, General Motors is leveraging the essential storage needs driven by AI data centers to open a new avenue, providing grid storage solutions for the overloaded U.S. power system and transforming a challenge in its EV business into a new growth opportunity.
General Motors' Chief Product Officer, Sterling Anderson, stated in a blog post that while past technological shifts were limited by processor speed or internet bandwidth, today's real bottleneck is energy.
He added that the company is developing large-scale battery storage systems for utilities and major power users while using its connected EVs to feed power back into local residential grids.
General Motors made this announcement after Ford's stock recorded its largest monthly gain in 17 years.
A Wall Street analyst cited Ford's new energy storage business as a potential beneficiary of the AI boom, further propelling its share price.
Ford has invested $2 billion in its storage business, including converting an EV battery plant to produce large-scale storage batteries using technology licensed from CATL.
According to compiled data, U.S. demand for grid storage batteries is projected to more than double by 2030, exceeding 100 gigawatt-hours.
General Motors' investment in the storage sector is relatively modest but has growth potential.
Its venture capital arm, GM Ventures, has taken an undisclosed stake in Peak Energy.
The two companies will jointly develop sodium-ion batteries, which are more suitable for stationary storage than the lithium-ion technology used in many EVs.
Sodium-ion batteries discharge faster, providing short, high-intensity power output, and their primary raw material, sodium, is abundant and inexpensive.
Furthermore, these batteries do not require cobalt—a metal often sourced from mines associated with child labor allegations—and pose a lower fire risk.
Peak Energy's CEO, Landon Mossburg, said the three-year-old company expects revenue of only $10 million this year but could grow to $100 million by 2027, driven by a $1.1 billion order backlog.
General Motors Battery Vice President Kurt Kelty stated that as the startup grows, the companies could produce sodium-ion batteries at existing GM plants or through joint manufacturing facilities.
He noted that General Motors has postponed building a battery plant in Indiana and may utilize that site or other existing facilities in the future.
Kelty emphasized that their approach differs from Ford's, as they are leveraging their own technological strengths to develop the best cell chemistry for this application, rather than retrofitting an existing plant.
General Motors is also partnering with Redwood Materials, a battery recycling company founded by Tesla co-founder JB Straubel, to repurpose old EV batteries for grid and commercial storage.
In March, General Motors and its Korean battery partner LG Energy Solution said they would shift production at a Tennessee plant to make stationary storage batteries for grid and commercial use.
The plant is owned by their joint venture, Ultium Cells LLC.
Ford CEO Jim Farley said last month that demand for the company's storage batteries is strong, with production lines expected to start by the end of next year.
General Motors is also actively encouraging more electric utilities to allow bidirectional power flow between its EVs and the grid.
Vehicles are idle 95% of the time and can be used as storage devices, charging during off-peak night hours.
However, widespread adoption of this "bidirectional charging" technology will take time.
Consumers need to install about $5,000 worth of hardware in their garages, and while some utilities offer incentives covering most of the cost, General Motors must convince vehicle owners to participate individually.
These efforts by General Motors indicate automakers are trying to salvage massive investments in EVs, which have proven difficult to sell to Americans even before the Republican-led repeal of a $7,500 federal tax credit.
General Motors once planned to have the capacity to produce 1 million EVs annually by 2025 but sold only 170,000 in the U.S. last year.
Although its deliveries trailed only Tesla, the limited sales mean its EV business remains unprofitable despite launching more than a dozen different models.
Subsequently, General Motors revised its plans, converting a Detroit-area electric pickup truck plant to produce gasoline-powered SUVs like the Cadillac Escalade.
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