The landscape of energy storage is undergoing a profound transformation, with advanced battery technologies emerging as a cornerstone for various industries. While electric vehicles (EVs) have long been the focal point of battery innovation, the demand for large-scale energy storage systems is rapidly expanding, particularly in data centers and industrial applications.
According to industry projections, the market for Battery Energy Storage Systems (BESS) is expected to grow from 22 GWh to 108 GWh by 2036, with an annual growth rate of 17.4%. This surge is driven by the escalating energy requirements of data centers supporting artificial intelligence (AI) and other high-demand applications.
State-of-the-Art Battery Technologies
The spotlight is on solid-state batteries which offer significant advantages over traditional lithium-ion batteries. By replacing the liquid electrolyte with a solid one, these batteries mitigate the risk of thermal runaway and fire, enhancing safety. CATL a leading battery manufacturer, has achieved a zero-propagation test on a system designed for electric vertical takeoff and landing (eVTOL) aircraft, demonstrating the potential of these technologies for various applications, including EVs and large-scale storage.
Solid-state batteries also enable the use of materials with higher energy storage capabilities, increasing energy density. This means more energy can be stored in a battery of the same size and weight. Samsung SDI plans to commence mass production of solid-state batteries in the second half of 2027 at its Ulsan facility in South Korea. The company’s investment plan, totaling 25,000 billion won (approximately 17 billion euros) by 2040, underscores the strategic importance of this technology.
Unexpected Applications of Solid-State Batteries
In a surprising twist, Samsung SDI has identified the first commercial application of its solid-state batteries not in EVs, but in humanoid robots and physical AI technologies. This shift highlights the versatility of solid-state batteries and their potential to revolutionize multiple sectors. Concurrently, Samsung SDI is collaborating with General Motors to develop new prismatic cells for future electric vehicles, illustrating the parallel progression of battery technology in both automotive and non-automotive domains.
Data Centers: A New Frontier for Battery Storage
Data centers are becoming a critical battleground for advanced battery technologies. LG Energy Solution a prominent battery manufacturer, reported quarterly revenues of 7,560.2 billion won (around 5.2 billion euros), driven by the growth of energy storage systems for AI-powered data centers. In the first half of 2026, the company secured contracts worth over 3,000 billion won (approximately 2 billion euros) for data center projects managed by major cloud operators.
Two notable projects in South Korea exemplify this trend. The Paju AI Data Center with a second-phase investment of 1.3 trillion won, will feature a 200-megawatt capacity and UPS battery systems from LG Energy Solution. Similarly, the Samsung Data Center constructed by LG CNS will boast an 80-megawatt capacity with integrated battery backup solutions. These projects are testing the reliability of new battery chemistries on an industrial scale, setting the stage for broader adoption.
Samsung SDI is also focusing on LFP batteries for energy storage and next-generation technologies, including sodium-ion and solid-state batteries. This diversification strategy aims to reduce reliance on the EV market, where demand has been relatively weaker compared to stationary storage applications. Notably, Samsung SDI’s return to profitability after seven quarters of losses was largely attributable to its energy storage systems for AI, rather than vehicle batteries.
The Path Forward
The technologies developed for high-capacity, continuous energy management in data centers are also pivotal for ultra-fast charging and stable power grids in charging stations. This synergy is evident in the development of semi-solid-state batteries as demonstrated by MG representing an intermediate step toward fully solid-state solutions.
As the energy landscape evolves, the interplay between different industries and technologies will continue to drive innovation. The journey of advanced battery technologies from data centers to robotics and EVs underscores the transformative potential of these breakthroughs, shaping the future of energy storage and beyond.
