CATL and Rolls-Royce collaborate on energy storage system

Rolls-Royce, a major UK supplier of power and propulsion solutions, recently announced a partnership with Chinese battery manufacturer Contemporary Amperex Technology Co Ltd to launch CATL’s new TENER product range in the European Union and UK.

Experts said they see the partnership as a strategic move to tap into Europe’s growing market for energy storage systems, driven by the rapid expansion of renewable energies. It also means deeper cooperation between China and Europe on production, not just sales in this sector, to reduce risks arising from geopolitical tensions and trade conflicts, they said.

Manufacturer TENER touts CATL as the world’s first zero-degradation energy storage system in the first five years of use, with a capacity of 6.25 megawatt hours that can be mass produced.

Rolls-Royce has already started offering TENER products as part of its mtu EnergyPack QG large-scale energy storage solution, primarily aimed at network operators. The new collaboration further includes the potential development of innovative smart products using Rolls-Royce’s mtu EnergetIQ intelligent automation solution, mtu Go! digital platform, as well as an intelligent CATL diagnostic platform and a battery management system.

Rolls-Royce said this partnership strengthens both companies’ capabilities to support large and complex grid-scale battery energy storage system projects.

Rolls-Royce also stated that battery energy storage systems are a strategic focus and development area for its Power Systems division.

Large or grid-scale energy storage systems enable the integration of renewable energy sources, whose power output may be intermittent or variable depending on weather conditions, into the power grid while increasing stability and reliability. They also enable customers to benefit from the latest network and commercial services, while supporting the energy transition by creating a more sustainable energy infrastructure, Rolls-Royce said.

Last year, Rolls-Royce and CATL signed a long-term supply agreement to collaborate on more than 10 gigawatt-hours of storage capacity.

“The new energy industry in Europe is growing rapidly. However, integrating new energy into the grid creates challenges for grid operational stability. Energy storage systems play a key role in enabling the absorption of new energy. China’s energy storage sector is advanced in technology and production, and can meet the huge market needs in Europe,” said Lin Boqiang, director of the China Institute of Energy Policy Studies at Xiamen University.

“For Chinese energy storage companies, collaborating with local companies in overseas markets instead of directly exporting can reduce project costs and mitigate risks from geopolitical tensions and trade conflicts,” he said.

Alex Zhu, energy, infrastructure advisor and carbon neutrality leader at Ernst & Young (China), emphasized the importance of creating strong cooperation links between Chinese energy companies and local producers in foreign markets.

“The focus should be on expanding value chains, sharing benefits and jointly managing risks with local businesses. This strategic approach ensures sustainable go-to-market and growth strategies rather than relying solely on sales,” he said.

Zhu highlighted growing demand in overseas markets for local energy production, investment, supply chains and services amid global trade uncertainty, with the aim of securing supply chains and ensuring on-time delivery.