GM pivots to sodium-ion grid storage in bid for AI data centre power

General Motors has announced a strategic expansion into the grid-scale energy storage sector, unveiling plans to develop a new sodium-ion battery chemistry in partnership with startup Peak Energy. This initiative aims to provide cost-efficient, stable power for industrial facilities and AI data centres, eliminating the need for complex cooling and fire-suppression systems. Concurrently, GM is strengthening its broader energy ecosystem by continuing to supply lithium iron phosphate (LFP) cells to LG Energy Solution and expanding its recycling collaboration with Redwood Materials, including a $3 million energy storage system installation at a Michigan plant.

The automaker’s move into sodium-ion technology represents a significant departure from current industry norms, as no other automaker outside of China has announced plans to build sodium-ion cells. Kurt Kelty, vice president of battery and sustainability at GM, described the approach as entering the market through energy storage systems (ESS) rather than consumer vehicles, noting that the performance characteristics of sodium-ion batteries are ideally suited for this application. The new chemistry swaps out key materials to create cells that are cheaper, longer-lasting, and less prone to overheating, although they require larger and heavier form factors to store the same amount of electricity.

Peak Energy, a New York-based startup, has already developed energy-storage systems designed to accommodate the unique behaviour of sodium-ion batteries. Because these batteries pose less risk of overheating, the resulting grid-scale units do not require cooling systems or fire-suppression equipment. Paul Menson, director of energy-storage commercialization at GM, stated that this design eliminates the most difficult engineering challenges, thereby reducing upfront costs and maintenance requirements. GM plans to sell sodium-ion cells to Peak Energy, with trial production of the first cells expected at GM’s Battery Cell Development Center in 2028.

In the interim period before sodium-ion commercialisation, GM will continue to sell lithium iron phosphate (LFP) cells to LG Energy Solution for use in its energy-storage systems. This collaboration builds on the existing relationship between the two companies through the Ultium joint venture, which manufactures batteries for GM’s electric vehicles. The automaker has committed $900 million to commercialise new battery chemistries, an investment that includes the development of the new Battery Cell Development Center, which GM expects will cut approximately one year from the commercialisation process for sodium-ion batteries.

Alongside the partnerships with LG and Peak, GM announced an expansion of its work with Redwood Materials, the battery-recycling and energy-storage startup founded by former Tesla executive J.B. Straubel. Redwood already purchases scrap from GM’s battery factories and used battery packs from its electric vehicles. GM is purchasing a 7.2 megawatt-hour Redwood system for use at a Michigan plant, an installation estimated to save the company around $3 million over its lifetime. Cal Lankton, chief commercial officer for Redwood, described the factory installation as a step one, noting that industrial sites use batteries differently than data centres, primarily to shave peaks in power demand and provide backup power.

GM Energy VP Wade Shef highlighted the broader context of these moves, noting that the company is also advancing vehicle-to-grid capabilities through partnerships with utilities in California and Michigan. In Northern California, GM is working with PG&E to develop a localized fleet of 52,000 electric vehicles for grid balancing protocols, expected to be operational by 2030. Simultaneously, in Michigan, GM is collaborating with DTE Energy to stress-test bidirectional charging using employee homes as real-world test cases.

Kelty emphasised the economic rationale behind the Redwood installation, stating that the company is excited to have a more reliable factory and plans to implement similar systems across all its manufacturing sites. The move underscores GM’s strategy to leverage its battery expertise to secure power for its own operations while positioning itself as a key player in the growing market for industrial energy storage solutions.