Published: Jun 20, 2025 10:40 PM Photo: Courtesay of Tesla US electric car maker Tesla signed an agreement on Friday for its first grid-side energy storage project in the Chinese mainland, according to a statement the company sent to the Global Times on Friday. The project will be a model for international energy cooperation, attracting more global enterprises to participate in China's green energy transition, and sharing Chinese development opportunities, Wang Peng, an associate research fellow at the Beijing Academy of Social Sciences, told the Global Times on Friday. The project will be located in Shanghai's Lingang New Area, with 4 billion yuan ($556.4 million) of investment. The project will use Tesla's Megapack storage technology and serve as a cornerstone for broader deployment in China, said the statement. Once operational, the project will participate in local peak-shaving and frequency-regulation services, as well as spot electricity trading, according to Dong Kun, head of Tesla China's energy business. "It will enhance grid flexibility and help integrate renewable energy in the Lingang New Area, supporting Shanghai's seasonal power demands and regional energy security," Dong said. Construction of Tesla's energy storage Megafactory started in May 2024. It became operational in February 2025, and started exporting products to Australia the following month. The energy storage Megafactory is the first of its kind built by Tesla outside the US and the company's second plant in Shanghai. The fact that it was able to start mass production just eight months after breaking ground was seen as another example of "Tesla speed" in China. Tesla said its global energy storage deployments reached 10.4 gigawatt-hours in the first quarter, a year-on-year increase of 156.6 percent. As China deepens its commitment to carbon neutrality and green development, energy projects such as this underscore the country's ambition to lead in global energy innovation, while offering international companies new opportunities for collaboration in the world's largest energy market, said Wang. RELATED ARTICLES