Still cheering an all-EV future while ignoring the battery boom happening behind the substation fence? That is like buying floor seats and watching the jumbotron. The real action in batteries is increasingly on the grid.

The problem

EV demand has undershot the rosiest forecasts in North America, pushing automakers to reassess timelines and capital plans. Cox Automotive flagged a likely cooldown in late 2025 into early 2026 after incentive changes, even as earlier quarters set volume records, a sign of choppier demand than many expected here. At the same time, power grids are integrating record solar and wind, which creates two headaches utilities know too well: midday curtailment and brutal evening peaks. In California, the battery fleet has become a first-string player to smooth those ramps and keep prices in check, as documented by the system operator in this CAISO special report and the state energy commission in this update.

The pivot

Automakers and their battery partners are finding a nearer-term growth engine in utility-scale energy storage. Tesla already dominates with Megapack, posting record energy storage deployments and guiding continued expansion in 2025 per its investor updates Q2 2025 and Q3 2025, with independent rankings consistently putting Tesla at or near the top of global integrators here. GM, meanwhile, has stood up GM Energy with home and commercial storage offerings, including the GM Energy PowerBank and bidirectional V2H capabilities that lay the groundwork for larger stationary plays April 2024 and October 2024. GM has also engaged Redwood Materials to channel second-life and new packs into stationary systems serving grids and data centers as reported here. Even where companies are pacing EV launches, stationary storage allows battery lines, chemistries, and supplier contracts to keep humming.

How grid batteries actually help

• Shift solar and wind - absorb surplus midday generation and release it into the evening peak.
• Shave peaks - reduce demand charges and ease stress on peaker plants and transmission.
• Stabilize frequency and voltage - respond in milliseconds to disturbances.
• Backstop reliability - provide capacity during heat waves and cold snaps.

In California, batteries frequently discharge over 8 GW during evening hours, with the fleet expanding from a few hundred megawatts in 2020 to well into the tens of gigawatts by 2025, materially reducing the net-load “duck curve” CAISO report. The state’s summer assessment also details how storage is now core to resource adequacy planning CAISO summer outlook.

Evidence and numbers you can use

• Record deployments - The US logged back-to-back record quarters for utility-scale storage in 2025, surpassing the entire 2024 total by Q3 PV Magazine. California’s fleet alone has reached milestones highlighted by the energy commission for strengthening grid reliability CEC.
• China’s surge - China added an eye-popping 65 GWh of grid batteries in December 2025, about a quarter of global deployments that year, underscoring how storage is scaling as fast as renewables Energy-Storage.news.
• Costs are bending lower - All-in costs for large systems have been clearing around the $125 per kWh mark in recent global procurements outside the US and China, reflecting cheaper LFP cells and optimized balance of plant NZero analysis.
• Tesla Megapack scale - Tesla’s energy storage deployments hit new highs through 2024 and into 2025, with Megapack factories in Lathrop and Shanghai ramping to meet utility demand Tesla Q2 2025. Market trackers continue to place Tesla at the front of the pack here.

What it means for reliability and prices

Storage is already shaving evening peaks and lowering the frequency of scarcity-price events. CAISO’s analysis shows batteries handling a growing share of the most expensive hours, which in turn reduces volatility and curtailment CAISO special report. As more storage pairs with new solar and wind, wholesale prices should continue to stabilize across the day, while customers see fewer demand spikes on the hottest afternoons. In the near term, deployment cadence can still be lumpy. Policy and trade uncertainty could create a 2026 speed bump for US installations even as the long-term need grows Utility Dive. But the macro trend is clear: batteries are becoming the cheapest, fastest tool to turn variable generation into firm capacity.

Jobs and manufacturing

Building utility-scale energy storage taps much of the same workforce as EV battery manufacturing: cell and module lines, pack assembly, power electronics, thermal systems, and software integration. That alignment gives automakers and their suppliers a way to keep high-value battery facilities busy where EV demand softens, while creating new roles in construction, interconnection, and operations across hundreds of storage sites. California’s leaders have been explicit that storage growth is a pillar of their reliability and clean-energy jobs strategy CEC.

The 2026 outlook

Expect more of a barbell. China looks set to continue outsized additions after its 2025 sprint source. In the US, interconnection and trade-policy friction could trim 2026 growth from 2025’s torrid pace Utility Dive, but rising peak demand, more corporate clean-energy buys that bundle storage, and AI data center load growth are structural tailwinds. Meanwhile, Tesla Megapack backlogs and GM Energy’s product buildout suggest the most battery-savvy OEMs will stay busy on grid projects Tesla GM Energy.

Bottom line

EV sales may be cooling from a boil to a simmer, but batteries are not taking a vacation. Grid battery storage is now the growth market for cells and packs, and it is solving real pain points for grids, developers, and customers. For utilities and corporates, that means more reliable power and fewer peak-price shocks. For automakers, it means another lane to scale battery manufacturing. For all of us, it means cleaner power that actually shows up when we need it.