General Motors (GM) has entered the growing competition to develop energy-storage systems for AI data centers and the power grid, marking a major expansion beyond its traditional automotive business.
The automaker announced new initiatives on Tuesday that include a partnership with energy-storage startup Peak Energy, as well as expanded collaborations with battery recycler Redwood Materials and LG Energy Solution.
A key highlight of GM’s strategy is its move into sodium-ion battery development, a chemistry that the company says is better suited for large-scale grid storage. The technology replaces key lithium-based materials with sodium, aiming to reduce costs, improve lifespan, and lower overheating risks.
However, GM noted that sodium-ion batteries are still heavier and require larger systems to store equivalent energy compared to lithium-ion alternatives.
Through its partnership with Peak Energy, GM will develop sodium-ion cells specifically designed for grid-scale energy storage. Peak Energy will integrate the cells into its storage systems, which are being designed with simplified architecture that reduces or eliminates components such as cooling and fire-suppression systems due to lower thermal risks.
According to GM executives, the streamlined design could reduce upfront costs and long-term maintenance expenses, making the systems more economically viable for industrial and data center applications.
GM said its first sodium-ion battery cells are expected to enter trial production in 2028 at its Battery Cell Development Center. The facility is expected to accelerate commercialization timelines and reduce development costs for new battery chemistries.
In the interim, GM plans to supply lithium iron phosphate (LFP) batteries to LG Energy Solution for use in energy-storage systems, leveraging its existing joint venture infrastructure.
The company also announced an expanded partnership with Redwood Materials, a battery recycling and energy-storage startup founded by former Tesla executive J.B. Straubel. Redwood already processes scrap materials from GM’s battery operations and used electric vehicle packs.
GM is reportedly supplying around 10,000 battery packs to Redwood, which has already deployed second-life batteries in a 12-megawatt/63-megawatt-hour microgrid powering a data center in Nevada.
Redwood said the collaboration with GM marks the beginning of broader industrial-scale deployments beyond data centers, including manufacturing facilities where battery systems can help manage power demand spikes and provide backup energy during outages.
Industry analysts say GM’s move reflects a broader trend in which automakers are increasingly entering the energy-storage market as demand for AI data centers drives massive growth in electricity consumption and grid infrastructure investment.
The shift also highlights growing competition among automotive and clean-energy firms to capture a share of the rapidly expanding global energy-storage sector, which is becoming central to both AI infrastructure and renewable energy integration.
