The United States electric vehicle (EV) industry is undergoing significant changes as manufacturers pivot towards energy storage solutions. This shift comes in response to the Trump administration’s recent initiatives aimed at rolling back policies from the Biden administration that supported EV adoption and climate change efforts. According to data from BloombergNEF, projections for EV sales in the U.S. have been reduced for the first time, with a cut of 14 million battery-powered cars expected by 2030. In contrast, global forecasts for EV sales continue to rise.
On his first day in office, President Donald Trump ordered the elimination of subsidies for electric vehicles. His administration is now loosening national fuel-economy standards, discontinuing EV tax credits, and blocking state-level emissions limits in California. BloombergNEF reported that these changes threaten to position the U.S. as a laggard in the global EV market. As a result, manufacturers are now scrambling for new revenue streams, particularly in energy storage.
Companies Embrace Energy Storage Solutions
Major players in the automotive and battery industries, including General Motors and LG, are fast-tracking projects aimed at energy storage. The growing demand for energy storage solutions is fueled by increased energy consumption from data centers, which have been stressed by the rise of artificial intelligence. For instance, Tesla reported a remarkable 67 percent increase in energy storage revenue, reaching $4 billion in 2024, making energy storage an essential component of its business model.
General Motors is also taking significant steps in this direction. The company recently signed a “non-binding memorandum of understanding” with Redwood Energy to sell both new and used EV batteries for reuse in energy storage projects. These batteries serve as a power bank, storing excess energy generated from renewable sources like wind and solar, which can then be fed back into the grid or used in data centers as required.
Kurt Kelty, Vice President of Batteries, Propulsion, and Sustainability at GM, emphasized the importance of energy storage solutions by stating, “Electricity demand is climbing, and it’s only going to accelerate. To meet that challenge, the U.S. needs energy storage solutions that can be deployed quickly, economically, and made right here at home.”
Repurposing Used EV Batteries
In addition to new battery production, there is considerable potential for repurposing used EV batteries in energy storage applications. According to a recent report by the Natural Resources Defense Council (NDRC), EV batteries that are retired due to diminished range can still serve valuable functions in energy storage. Jordan Brinn, the report’s author, noted that even batteries that have lost 20 percent of their original capacity can remain effective for grid storage for several additional years.
Moreover, even batteries that are considered fully depleted can still be beneficial. Brinn highlighted that approximately 95 percent of the minerals in a defunct EV battery can be recycled to create new batteries for both electric vehicles and energy storage systems. This presents a new revenue stream for EV manufacturers, allowing them to sell both new and used products to recycling centers, particularly as EV sales face challenges in the current policy environment.
As U.S. EV makers navigate this turbulent landscape, energy storage appears to be a promising avenue for growth and innovation. By adapting to the shifting policy framework, companies like General Motors and Tesla are not only addressing immediate market pressures but also positioning themselves as key players in the future of energy infrastructure. As demand for electricity continues to rise, the importance of efficient energy storage solutions cannot be overstated.
