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China’s dominance of the battery supply chain is uncontested. Many U.S. storage companies have tried to catch up by replicating the technologies already in mass production there. But a smaller cohort is taking a different tack: building factories for next-generation batteries that could give American manufacturers more of a competitive edge.
Peak Energy is one of the newest members of that cohort. The startup, which appeared on the scene in 2023, took a big step this summer when it shipped its first sodium-based grid-battery system for installation in the field. The 875-kilowatt/3.5-megawatt-hour battery is now being completed in Watkins, Colorado, at a testing facility known as the Solar Technology Acceleration Center.
In fairness, the battery cells were imported from China, but Peak designed and built a new enclosure for them in Burlingame, California. Since the sodium batteries are especially rugged, Peak could forgo the temperature-control equipment needed for the current favorite chemistry for grid storage, lithium ferrous phosphate (LFP). If this first installation works well and the cost savings are as consequential as promised, Peak plans to build U.S. manufacturing for the whole package, cells and all.
The installation is a rare bright spot as the storage industry at large grapples with the impacts of Trump administration energy policy. President Donald Trump’s unpredictably shifting tariffs on China have raised the costs of imported batteries and made it hard to plan. The White House’s signature budget law ripped up some — but not all — tax credits meant to support domestic manufacturing of batteries, and added dense new bureaucratic requirements around components from China. New investment in domestic clean-energy manufacturing has plummeted since Trump took office.
But the power sector still wants to build grid batteries at record pace, especially as supersized data centers clamor for electricity supply as soon as possible.
Upstart battery-makers often jockey over how much energy density they can pack into their cells, or how they can reduce the fire risks that follow from squeezing so much energy into a tight footprint. Peak Energy brags more about what its technology doesn’t need: heavy-duty climate control.
“If you think about it, an LFP [energy storage system] is essentially a giant refrigerator that has to operate flawlessly for 20 years in the desert,” said Cameron Dales, Peak’s chief commercial officer and cofounder. That’s because that particular chemistry ideally needs to stay within a few degrees of 25 degrees Celsius (77 degrees Fahrenheit) to preserve its useful life; serious deviations from that safe zone could lead to declining performance or even dangerous failures. A handful of dramatic battery fires has already inspired community pushback against storage plants, making safety a crucial part of the industry’s social license. Indeed, this week U.S. Environmental Protection Agency Administrator Lee Zeldin pledged to support communities resisting nearby battery installations.
The sodium-ion cells that Peak favors — technically called sodium iron pyrophosphate or NFPP — can withstand a much broader range of temperatures, from minus 20 degrees C (minus 4 degrees F) to 45 degrees C (113 degrees F). Peak’s engineers thus dispensed with the usual battery-cooling systems, relying instead on what Dales calls “clever engineering” around how the cells fit into the broader package. “There’s no moving parts, no fans, no liquids, no pumps, no nothing,” he said. The container does include a solid-state heater to ensure the cells never get too cold to charge.
This saves money by reducing the cost of materials and cutting auxiliary power usage up to 90% over the life of the project. But axing the conventional safety equipment brings one more major benefit, because that hardware has paradoxically caused several of the recent high-profile grid-battery fires (by, for example, erroneously spraying water on live batteries, which can make a fire where there wasn’t one).
Plenty of cleantech startups have pitched themselves as safer alternatives to dominant strains of lithium-ion batteries, only to be crushed mercilessly by the lithium-ion manufacturing juggernaut. Overwhelming scale and a wealth of industrial expertise keep pushing mainstream batteries to lower prices and superior performance. However, the up-front costs of the batteries themselves are now just a small piece of the overall bill.
“What has not really been addressed is the construction and installation of a project, and then, even more importantly, the long-term operating costs associated with running that power plant,” Dales said.
According to Dales’ calculations, the energy savings from the passive cooling of Peak Energy’s battery enclosure over a period of 20 years more than cover the initial cost of the battery cells. That’s one way to lure customers to a type of battery they haven’t seen before.
“How can a startup, who’s just getting up to speed and their costs are high and volume is not there yet, compete and win on a project like that?” he said. “It’s because these project economics are so good that even today, we can win on cost relative to … a Chinese LFP system.”
Flipping the switch on the Colorado project is just the start. Then Peak Energy needs to find paying customers interested in much bigger versions of the technology. But the startup has an innovative plan for that next step.
The founders of many battery startups focus on a technology that they find interesting (maybe they chose it for their doctoral research years ago), and then at some point have to convince customers to buy it. This typically leads to what Dales identified as “a classic failure mode, to get piloted to death.” The eager startup spends its precious time developing insignificant yet money-losing pilot installations with lukewarm customers, who try it for a few years and decline to make a follow-up purchase. Then the startup runs out of cash and collapses.
Peak Energy’s founders decided on a different strategy: develop a product in conversation with prospective customers, so they actually want to buy it when it’s ready.
The Colorado project, paid for by Peak, will be scrutinized by a consortium of nine utilities and independent power producers, who have signed on to receive exclusive performance data. If the project meets agreed-upon metrics, these companies will buy Peak’s product for their own use.
“If we do what we say we’re going to do, and the economics are what we think they are, then you should sign up for doing a real project, because it actually makes sense for you,” Dales explained. “That’s how these companies have entered the program, and now we’re in the ‘proof is in the pudding’ phase.”
Some of those consortium members have requested batteries for demonstration projects in 2026, in the storage range of 10 MWh to 50 MWh, Dales said. One large power developer is working on a 2027 project that would deploy nearly one gigawatt-hour of Peak’s sodium batteries to support a hyperscaler data center.
The path from initial installation to giga-scale projects always takes longer than battery startups initially pledge. In fact, only lithium-ion batteries have crossed that threshold, while more unusual variants languish in the minor leagues.
But Peak doesn’t have to invent the core technology — it’s piggybacking off an emerging field of China’s battery industry — and it’s coming to market at a time of propulsive growth in grid storage demand. Its task might not be quite so daunting as it has been for other battery innovators.
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