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8h ago

Tesla Signs $556M Deal to Build China’s Largest Grid-Scale Battery Project

Using Megapack systems as a smart regulator the installation aims to stabilize Shanghai’s power grid under growing renewable output.

The Gambit Energy Storage Park in Angleton, Texas.
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The Tesla logo is seen during the Viva Technology conference dedicated to innovation and startups at Porte de Versailles exhibition center in Paris, France, June 12, 2025. REUTERS/Benoit Tessier/File Photo
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Overview

  • Tesla signed a 4 billion yuan ($556 million) agreement on June 20 with the Shanghai municipal government and China Kangfu International Leasing to launch its first grid-scale storage facility in China.
  • The installation is set to be China’s largest grid-side storage project and leverages Megapack modules that deliver up to one megawatt for four hours.
  • Tesla’s Shanghai Gigafactory began Megapack output in February 2025 and produced over 100 units in the first quarter, some of which have been exported to Europe and Asia.
  • The facility will act as a smart regulator to dynamically balance supply and demand on urban grids and support China’s drive to add nearly 5 gigawatts of battery storage by the end of 2025.
  • The agreement underscores Tesla’s push into China’s energy storage sector as it vies with domestic giants such as CATL and BYD despite tariffs from President Donald Trump’s administration.