Analysts at the US Department of Homeland Security shared an internal report with local agencies in August, warning them of the economic risks of using Chinese storage batteries. It warns that dependence on Chinese batteries could harm the creation of a secure supply chain in the US.
The document, first obtained by the National Security Transparency non-profit Property of the People and seen by WIRED, accuses Chinese companies of “using government support of the People’s Republic of China to quickly and cheaply enter the nascent US battery energy storage industry and create supply dependency.” chain China,” and calls for any suspicious activity to be reported.
Specifically, the report accuses three companies—Contemporary Amperex Technology Co. Limited (CATL), Build Your Dreams (BYD), and Ruipu Energy Co. Ltd. (REPT)—”benefited from various forms of government support and used this for other business strategies to gain US market share.”
Currently, CATL and BYD lead the global energy storage battery market, with 40 percent and 12 percent market shares, respectively, according to South Korean energy research firm SNE Research. Eight of the top 10 companies in the industry are from China, so there are few other options to turn to when building grid storage.
The report says it builds on previous documents that have analyzed Chinese state-backed companies’ use of anticompetitive tactics in electric vehicle and battery supply chains. DHS did not respond to a request for additional comment.
In 2022, CATL struck a deal with Primergy Solar to build the largest US solar and storage project in Nevada, which went online this year. Its battery products are also used by Duke Energy, a North Carolina-based utility company, although the company dropped CATL as a supplier of marine storage after national security concerns were raised, in part, by lawmakers in Washington.
In an emailed statement, Fred Zhang, a spokesman for CATL, rejected the classification that the company is relying on government support to get the limit. “CATL has achieved significant growth through continuous innovation, forward-looking strategic planning, and a commitment to quality products at the right price,” the statement said.
BYD and REPT did not respond to WIRED’s request for comment.
After efforts to curb competition from Chinese EV companies, the US government is now worried about how domestic companies may become more dependent on Chinese batteries for energy storage.
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