Tesla has started trial production at its Megapack assembly plant in Shanghai, China, state-owned news reported this week (31 December).
It is the electric vehicle (EV) and battery energy storage system (BESS) firm’s second major manufacturing facility dedicated to producing its grid-scale Megapack BESS product, after its existing facility in Lathrop, California.
Enjoy 12 months of exclusive analysis
- Regular insight and analysis of the industry’s biggest developments
- In-depth interviews with the industry’s leading figures
- Annual digital subscription to the PV Tech Power journal
- Discounts on Solar Media’s portfolio of events, in-person and virtual
Or continue reading this article for free
Mass production at the Shanghai site is expected to begin in the first quarter of 2025, the company told Xinhua News Agency (New China News Agency), claiming it was built in record time.
Its initial capacity will be 10,000 Megapacks a year, or 40GWh of energy storage capacity, and Tesla invested around US$200 million (1.45 billion CNY) into it.
The report added that the project defies the rhetoric of the US ‘decoupling or derisking from China, ratcheted up by some American politicians’, referencing the move by the US to become less reliant on China for clean energy technologies including solar and batteries. That is being done by both supporting its own domestic manufacturing sector (Premium piece) and slapping tariffs on products from China, particularly from president-elect Trump.
Tesla already has an EV manufacturing plant in Shanghai where it recently celebrated three million EVs produced.
In May, it signed a deal with Shanghai Lingang Economic Development (Group) Co., Ltd for the order of the first units produced at the Megapack factory in Shanghai. However, an announcement about a BESS project in Chile may also utilise some of the factory’s first output.
Colbun orders nearly 1GWh of Megapacks for Chile project
Utility and independent power producer (IPP) Colbun has signed a contract with Tesla for the supply of 228MW/912MWh of Megapacks for its Celda Solar project, located in the Arica and Parinacota region, north Chile.
Celda Solar will be Colbun’s first large-scale BESS project and one of the largest projects in Chile, it said, and will be co-located with a 228MW solar plant. It already has a smaller, 32MWh BESS online.
It will require US$260 million of investment, is being built on an eight-hectare plot of land from the Ministry of National Assets and is expected to come online in mid-2026. The land was presumably secured from a bidding programme the Ministry launched earlier this year, with space available for 13GWh of standalone BESS projects.
The project will require the construction of a new substation as well as a 3.5 kilometer transmission line to connect with an existing one.
Colbun has 12 operational run-of-river hydropower plants and four operational pumped hydro energy storage (PHES) plants, which its CEO José Ignacio Escobar said new BESS projects would complement well.
“Our energy stored in the southern reservoirs perfectly complements the energy we will store in our batteries in the north, thus having a secure, diversified and competitive offer for our clients from Arica to Puerto Mont,” he said.
Chile is a hotbed of energy storage activity and is all but certain to lead deployments in the Latin America region, explored in an article in the most recent edition of Solar Media’s quarterly journal PV Tech Power.
The Megapacks for Colbun’s project may come from the Shanghai factory. Many large system integrators and BESS manufacturers are setting up manufacturing outside China to serve the US market and avoid the aforementioned tariffs, and using China facilities to serve demand outside of the US.
