Wärtsilä energy storage JV Valo in US domestic content manufacturing discussions with ‘strong players’

While key markets in Europe, such as Germany, Poland, the UK and Nordic countries will be a major focus, as might be expected given RCT Solutions’ own background in Europe, Peter Fath said the US is a “must” and is among Valo’s “key target markets.”

However, US “political regulation is very challenging” for battery storage system integrators, as seen in recent sudden changes occurring within months of one another.

For instance, Wärtsilä ended an 18-month-long strategic review of its energy storage business in early 2025, saying the company was “committed” to success in the energy storage sector. It simplified the ES&O brand to Wärtsilä Energy Storage.

US President Donald Trump famously announced a wave of ‘reciprocal’ tariffs on international trading partners on 2 April 2025. This was the same day that Wärtsilä Energy Storage’s president, Tamara de Gruyter, took the role for a period that ended with the launch of Valo.    

That immediate change of dynamics, De Gruyter said in an April 2026 interview with ESN Premium, had depressed the US market while competition in other parts of the world increased “because everyone started looking for other markets.”

Valo is in partnership talks with ‘strong US players’

Having now taken over from de Gruyter, so to speak, Peter Fath reiterates the predecessor’s assertions that the US market situation naturally means Wärtsilä’s position in other BESS markets, including Australia, where it has typically been very strong, and Europe, becomes more important.

Yet, Fath says, “you cannot ignore the USA, you have to be active in the USA.”

Both through new policies and continuation of previous ones, the current US administration has taken a ‘stick’ approach to trade policy and domestic inward investment through tariffs and restrictions, as well as a ‘carrot’ approach to incentivising domestic content through tax credits.

Much like Tesla, Wärtsilä, as an integrator that imports cells from China-based or Chinese-owned sources, is exposed to the downside and not able to fully avail of the upside.

The only way to tackle the barriers and challenges, Fath said, is either to have a “very strong partnership with one big manufacturer in the USA, or you have to set up your own factory.”

“That’s a consequence, and that is what we have decided to do. So we are first talking with strong US players with whom we could join forces, and a potential announcement will come.”   

Fath noted that, like Tesla’s Megapack 3, Wärtsilä’s flagship BESS solution, Quantum 3, is an integrated AC solution, which may be a complex proposition to outsource to a third party, so internal company discussions remain ongoing.

Even early adopters of the US domestic or near-shored value chain have taken some time to come to terms with the new market dynamics.

Fluence recently revised its revenue and EBITDA guidance for its 2026 financial year downward, as delays in bringing a BESS assembly line online in Houston, Texas, impacted its ability to meet US customer demand. The company has invested in in-house and contract manufacturing over the past few years, with factories across the US specialised in different components, such as modules, enclosures, HVAC (at the Houston plant), and cells.

Around half of Fluence’s portfolio and pipeline of BESS projects is US-based. While stating that steps are in place to remedy the situation and prevent a repeat or anything similar, Fluence CEO Julian Nebreda said in September that the complexity of ramping up the Houston facility had been underestimated. A review of supply chains, production systems, processes and execution discipline is currently underway.