A major European storage bet
Tesla and independent energy company NatPower have reached an agreement to build 25 gigawatt-hours of battery storage in Italy and Britain. It is the first phase of a multiyear programme worth up to $5 billion, and it pushes Tesla's energy business deeper into a European grid-storage market that is expanding rapidly as the continent adds intermittent wind and solar capacity.
Under the deal, NatPower will deploy Tesla's Megapack systems and run them using Tesla's trading software, which decides when to buy and sell electricity from the grid. That combination — hardware plus a revenue-optimising control layer — is what makes large standalone storage projects commercially viable rather than purely a balancing tool.
The numbers
The headline figures give a sense of the programme's scale:
| Metric | Figure |
|---|---|
| First-phase capacity | 25 GWh |
| Initial projects | 5, in Italy and the UK |
| Long-term target | More than 100 GWh |
| Construction cost | $4 billion to $5 billion |
| Projected revenue | More than $15 billion over 20 years |
The five initial projects are the opening move. NatPower has signalled that the full programme aims to exceed 100 GWh of storage capacity over time, which would make it one of the larger battery-storage pipelines in Europe.
Why grid storage, and why now
Countries across Europe are racing to add battery storage because renewable generation is intermittent: solar peaks at midday, wind is variable, and demand does not follow either. Large battery systems soak up cheap surplus power and release it when generation falls and prices rise, smoothing the grid and earning the difference. As more wind and solar come online, the value of that buffering grows.
For Tesla, the agreement is significant beyond the immediate hardware sale. Tesla's energy-storage division has become one of the company's fastest-growing and highest-margin segments, and Megapack deployments at this scale provide steady, multiyear demand that is largely insulated from the swings in its automotive business.
What it means for European owners and the grid
For European Tesla owners, the deal is less about the car and more about the ecosystem around it. More grid-scale storage in Italy and the UK should help stabilise local electricity prices and support the rollout of renewables that underpin cleaner home and vehicle charging. Italy and Britain are the launch markets, but the stated ambition to surpass 100 GWh suggests further European countries could follow as later phases are announced.
The partnership also signals that Tesla intends to compete seriously for Europe's utility-scale storage contracts, not just sell home Powerwalls — a strategic expansion that ties the company's growth to Europe's energy transition rather than to EV sales alone.