Summary: Chinese battery companies are expanding production capacity to 900 GWh per year, mainly for Battery Energy Storage. Chinese battery makers announced plans in early 2026 to add over 600 GWh of new production capacity for the energy storage system (ESS) market, with the total buildout reaching 900 GWh annually once complete — roughly ten times the 58 GWh installed across the entire US in 2025. Around 70% of the new capacity will serve the ESS market, with the remaining 30% going to EVs. The 19 Chinese producers tracked by GGII are investing a combined 180 billion yuan ($26.3 billion) in new lithium-ion factories. The expansion is being driven by surging demand linked to AI data centre growth and global decarbonisation, with global ESS battery demand already up 79% year-on-year to 550 GWh in 2025, where Chinese firms hold over 80% market share. CATL alone is investing 20 billion yuan in a single zero-carbon production hub in Fujian capable of delivering up to 200 GWh annually. However, Chinese regulators have begun intervening, convening major battery makers to address concerns about irrational price competition and overcapacity.

“Mainly for energy storage.” Yup. That’s what batteries do.