Ford is diving into a new venture beyond the road. The motor company announced a new business dedicated to repurposing manufacturing facilities into large-scale battery energy storage systems. Ford’s strategic move aims to capture the surging demand for energy storage from data centers and the electric grid. To support this plan, the motor company intends to invest approximately $2 billion over the next two years.

This move comes at a critical time as data centers become a central priority for national infrastructure. As our world becomes increasingly digitized, driven explicitly by artificial intelligence, cloud computing, and massive data processing, these facilities require a continuous and reliable power supply. Because data centers operate 24/7, they need robust storage solutions to manage energy loads and provide backup power. As a result, data centers are a primary driver for the battery technology Ford is now scaling.

Building Battery Energy Centers For Data Centers

Data center
Representational image of a data center; Photo: Sashkin/Shutterstock

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Ultimately, Ford’s initiative is designed to be a “diversified and profitable revenue stream” through underutilized EV battery capacity. According to Ford planners, they plan to convert a site in Kentucky to produce advanced systems with capacities of 5 MWh and greater. The facility will manufacture LFP prismatic cells, battery modules, and 20-foot DC container systems.

One of the system’s greatest benefits is its ability to support grid reliability. Storing energy during periods of low demand and releasing it during peaks ultimately helps prevent outages and reduces the strain on infrastructure. Additionally, utilizing LFP (lithium iron phosphate) chemistry offers durable and efficient solutions for stationary storage, which typically requires longer cycle lives.

A Joint Venture

A recent joint venture disposition agreement between Ford, SK On, SK Battery America, and BlueOval SK facilitates the transition. Per the agreement, “a Ford subsidiary will independently own and operate the Kentucky battery plants,” while SK On will maintain operations in Tennessee. Ford expects to bring initial capacity online within 18 months. Its ambitious goal includes deploying “at least 20 GWh annually by late 2027.”