INVESTMENT THESIS 2026

The Energy Storage Revolution

Battery costs breaking $100/kWh. Grid storage growing 50-60% annually. 20M EVs sold globally. From lithium mines to virtual power plants — the electrification supercycle is here.

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Global EV Sales 2025
$0
Record Low Pack Price
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US BESS Additions 2025
$0
CATL Market Cap
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US Public Charging Ports
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Global Battery Installs
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The Electrification Value Chain

From mine to wheel to grid. Three structural forces converge: lithium price recovery, battery cost breakthroughs, and explosive grid storage deployment.

Market Size by Segment (2026E)

Key Market Metrics

Li Carbonate Price
$20K+/t
Rebounding from $10K bottom
LFP Pack Price
$81/kWh
37% cheaper than NMC
LFP Market Share
~60%
Overtook NMC in 2025
US BESS Cumulative
~42 GW
Targeting 64 GW by 2026
IRA 45X Credit
$45/kWh
$2,700/vehicle for 60 kWh
China NEV Share
~60%
BYD + CATL dominance

Core Thesis

The energy storage value chain is at an inflection point: lithium prices have bottomed, battery costs are breaking $100/kWh, and grid storage is creating an entirely new demand pillar. The investment opportunity lies in companies that can navigate the tension between Western onshoring and Chinese dominance.

The Cycle Has Bottomed

From $80K to below $10K and back above $20K. Survivors emerge stronger as supply-demand tightens toward deficit in 2026.

Lithium Price Cycle ($/tonne LCE)

Extraction Cost Tiers

Chilean Brine (SQM)
Salar de Atacama, lowest-cost globally
$3.5-4.5K/t
AU Hard Rock (Pilbara)
Pilgangoora spodumene concentrate
$8-12K/t
DLE Technology
Standard Lithium, Lilac Solutions (pre-commercial)
TBD
Recycling (Redwood)
70-90% NA market share, 20-25 GWh/yr
$10-12B mkt

Lithium Supply vs Demand (MT LCE)

Chinese Dominance & the Western Catch-Up

CATL and BYD control 55.6% of global EV battery share. LFP chemistry has overtaken NMC. The IRA is the lifeline for Western manufacturers.

Global EV Battery Market Share (2025)

Battery Chemistry Comparison

$108
Record low average pack price ($/kWh, 2025)
$81
LFP Pack $/kWh
3,000-10,000 cycles
$128
NMC Pack $/kWh
Higher energy density
Next frontier: CATL Naxtra Na-ion
175 Wh/kg, $0.04/Wh target, commercial 2025

Battery Pack Cost Trajectory ($/kWh)

The Infrastructure Backbone

The fastest-growing demand driver for batteries. US added 10.4 GW in 2024 and is targeting ~19.6 GW in 2025. IRA standalone storage ITC transformed project economics.

US BESS Deployment (GW)

Grid Storage Leaders

Tesla Megapack
39% US share, 46.7 GWh deployed
130 GWh/yr
Fluence Energy
$5.5B backlog, Mosaic software
$3.2-3.6B
Eos Energy (LDES)
Zinc-based, 35x YoY revenue growth
$303M DOE
Form Energy (LDES)
100-hour iron-air, GE Vernova backing
Private

50%

IRA Storage ITC (Maximum)

A 100 MW/400 MWh BESS that was marginally economic pre-IRA now achieves 5-7 year payback at the maximum credit level. This single policy change is the primary driver of the 2024-2025 deployment surge.

The 20% Inflection Point

Global EV penetration crossed 20% in 2024 with 17M units sold. BYD leads with 4.6M NEVs. The S-curve of mass adoption has begun.

EV Sales by Region

Charging Infrastructure

US Public Ports
~186K
1.2M needed by 2030
Tesla NACS Stalls
35,682
52.5% of US DCFC
ChargePoint Ports
1.3M
Software pivot, 33% margin
VPP Customers
106K
Sunrun, 400% growth
California VPP test: 100K batteries = 535 MW
Equivalent to a mid-size gas peaker plant

Global EV Adoption S-Curve

The Investable Universe

From lithium miners to grid storage pure-plays. Filter by conviction tier across the full energy storage value chain.

All
Tier 1 — Core
Tier 2 — Growth
Tier 3 — Speculative

Catalyst Calendar

Key dates from lithium price triggers to solid-state validation and grid storage milestones.

What Could Go Wrong

Ten risks across the value chain, from Chinese dominance to policy reversal and technology disruption.

Recommended Watchlist

Position in cost-advantaged lithium producers and grid storage leaders now. Watch for the $100/kWh battery cost barrier to break — it unlocks unsubsidized EV-ICE price parity and accelerates the entire value chain.

Research compiled February 2026. Not investment advice. See sources below.

Sources & References

Lithium & Mining

  • Albemarle Q3 2025 Results, Kings Mountain Project (Seeking Alpha)
  • SQM-Codelco NovaAndino Litio Partnership; SQM $2.7B Expansion (CarbonCredits)
  • Pilbara Minerals FY2026 Guidance (ShareCafe); Q4 FY25 Results
  • Rio Tinto Completes Arcadium Acquisition (riotinto.com)
  • Ganfeng Lithium 2025 Earnings Forecast (EnergyTrend)
  • Lithium Americas Thacker Pass Q3 2025; DOE Loan Agreement
  • Standard Lithium DFS Results; Lilac Solutions IXM Manufacturing
  • Lithium Price Surge 2026 (CarbonCredits); S&P Global Outlook
  • Redwood Materials $350M Raise; Glencore Li-Cycle Acquisition
  • Li-Ion Battery Recycling Market (Precedence Research)

Battery Manufacturing

  • CnEVPost, Electrive: Global EV battery market share 2025
  • BloombergNEF record low battery prices; Battery Tech Online data
  • InsideEVs LFP dominance; IEA Global EV Outlook 2025
  • CATL sodium-ion commercial production (CleanTechnica)
  • QuantumScape solid-state breakthrough (AINvest)
  • BMW-Solid Power-Samsung SDI consortium (BMW Press)
  • C2ES 30D & 45X credits; Akin IRA reconciliation
  • McKinsey Battery 2035; BYD vertical integration (EVBoosters)

Grid Storage

  • Fluence Energy FY2025 Results, Record Backlog (GlobeNewsWire)
  • Tesla Megapack milestones (Teslarati, Wood Mackenzie)
  • EIA battery capacity data; Wood Mackenzie US storage installs
  • FERC Order 2222 Fact Sheet; CAISO, ISO-NE implementation
  • California VPP test (CleanTechnica, Energy-Storage.News)
  • Form Energy factory and financing (WESA, Utility Dive)
  • Eos Energy Q3 2025 revenue, DOE loan (investors.eose.com)
  • IRA Storage ITC (McGuireWoods, IRS); NREL cost projections

EV Ecosystem

  • IEA Global EV Outlook 2025; Tesla Q4 2025 deliveries
  • ChargePoint Q3 FY2026 results; EVgo Q3 2025 results
  • Rivian R2 pricing (Car and Driver); DOE loan (TechCrunch)
  • BYD 2025 sales (eletric-vehicles.com, Triden Technology)
  • NEVI program status (GreenCars); US EV adoption (S&P Global)
  • Sunrun VPP growth (Utility Dive, pv magazine)
  • EV adoption S-curve analysis (RMI)