GM Targets AI Power Demand with Grid Batteries

As artificial intelligence continues to drive unprecedented demand for electricity, automaker General Motors (GM) has unveiled an ambitious plan to develop large-scale energy storage systems aimed at supporting AI data centers and national power grids.

The move positions GM among a growing number of companies seeking to address the energy challenges created by the rapid expansion of AI infrastructure. While battery recycling startup Redwood Materials and automaker Ford have already entered the grid-scale battery market, industry observers view GM’s latest initiative as one of the most significant developments yet.

Betting on Sodium-Ion Technology

GM has announced a major partnership with California-based energy storage startup Peak Energy to develop a new generation of sodium-ion batteries specifically designed for grid-scale energy storage and AI data center backup systems.

According to GM, no major global automaker outside China has previously committed to producing sodium-ion battery cells for data center and power grid applications.

GM Vice President of Batteries and Sustainability Kurt Kelty described sodium-ion chemistry as particularly well suited for energy storage systems, citing its cost-effectiveness and operational advantages. Although the company has not disclosed the value of the partnership, GM has already allocated US$900 million toward battery development and related research facilities.

Why Sodium-Ion Matters

Unlike conventional lithium-ion batteries, sodium-ion batteries rely on more abundant and lower-cost materials. They also offer improved thermal stability, reducing the risk of overheating.

While sodium-ion batteries are generally larger and heavier than lithium-based alternatives, those limitations are less important for stationary installations such as data centers and power grids.

Peak Energy’s battery systems are designed to operate without expensive cooling or fire-suppression systems, significantly reducing both deployment and maintenance costs.

GM Energy Storage Commercialization Director Paul Manson said simplifying battery design by eliminating unnecessary components can improve reliability and lower long-term operating expenses.

Commercial Rollout Plans

GM plans to begin pilot production of sodium-ion battery cells at its Battery Cell Development Center in 2028.

Until commercial production is ready, the company will continue supplying lithium iron phosphate (LFP) battery cells through partnerships with LG Energy Solution, providing an immediate solution for energy storage applications.

Expanding Collaboration with Redwood Materials

GM is also strengthening its partnership with battery recycling company Redwood Materials, founded by former Tesla executive JB Straubel.

The automaker is supplying approximately 10,000 retired EV battery packs to Redwood for reuse in large-scale energy storage projects. Redwood has already deployed used EV batteries to operate a 12-megawatt microgrid supporting an AI data center in Nevada, helping stabilize GPU-related power fluctuations.

In addition, GM is purchasing a 7.2-megawatt-hour battery storage system from Redwood for one of its Michigan manufacturing facilities. The system is expected to reduce peak electricity costs, provide backup power during outages, and generate roughly US$3 million in lifetime savings.

Supporting the AI Infrastructure Boom

Industry analysts note that the explosive growth of AI applications is placing increasing pressure on electricity grids worldwide. While technology giants such as Microsoft, Google, and OpenAI are exploring nuclear energy and other large-scale power solutions, the integration of advanced battery technologies from the automotive sector could offer an important complementary approach.

Experts believe the convergence of electric vehicle battery innovation and AI infrastructure development may play a critical role in addressing future energy demands while supporting more resilient and sustainable digital ecosystems.

DBTech/BMT/OR