Elon Musk says the fastest way for the United States to dramatically increase its effective energy output isn’t by building new power plants: it’s by deploying batteries at scale. By buffering energy that already exists, Musk argues the U.S. could nearly double the amount of usable energy it produces each year without massive new generation investments. He also pointed to China as already moving aggressively in this direction, building enormous battery systems alongside electric vehicles and solar at an industrial scale.
Musk’s argument hinges on a distinction that rarely makes it into public energy debates: peak power versus average power. According to Musk, the CEO of Tesla (TSLA) and SpaceX, the U.S. power system can deliver roughly 1.1 terawatts at peak demand, but average usage sits closer to half a terawatt. That means vast amounts of generation capacity exist solely to meet short bursts of demand and remain underutilized much of the time.
In Musk’s view, batteries are the simplest solution to that mismatch. By charging during periods of low demand, often overnight, and discharging during peak hours, energy systems can dramatically increase how much useful work they perform over the course of a year. The striking claim is that this improvement doesn’t require doubling power plants, transmission lines, or fuel inputs. It’s largely a matter of storing energy more intelligently.
Framed this way, batteries aren’t a peripheral technology. They become core infrastructure. Musk described large-scale storage as the most efficient lever available to raise national energy productivity, arguing that the system already has the raw capacity, it just lacks the buffering needed to use it continuously.
When asked why this hasn’t been fully implemented, Musk suggested that in some parts of the world, it already is. He pointed to China, noting that the country is producing massive battery packs, scaling electric vehicle manufacturing, and deploying solar at unprecedented levels. Whether through deliberate strategy or parallel reasoning, Musk implied that China is building an integrated energy system where generation and storage grow together, saying, “It seems like China listens to everything I say and does it basically. Or they're just doing it independently. They're certainly making massive battery packs, like really massive battery pack output. They're making vast numbers of electric cars, vast amounts of solar.”
That integration matters. Large batteries smooth out fluctuations in power supply, electric vehicles act as both consumers and distributed storage, and solar provides abundant input. Together, they reduce waste, stabilize grids, and increase total energy throughput without proportionally increasing physical infrastructure.
For the United States, Musk’s comments amount to a reframing of the energy challenge. Rather than focusing exclusively on how to generate more power, he suggests the bigger opportunity lies in using existing power more efficiently. Grid-scale storage remains relatively small compared to total capacity, and regulatory and market structures often lag behind what battery technology already enables.
From an economic and policy perspective, Musk’s framing elevates batteries to the same strategic importance as power generation itself. If timing, not supply, is the real constraint, then storage becomes a primary driver of energy abundance. That has implications for utilities, automakers, grid operators, and national industrial strategy.
Musk’s thesis is simple but disruptive: the U.S. doesn’t need to wait for breakthroughs to dramatically increase energy output. The tools already exist. The question, he suggests, is not whether it’s possible, but why deployment isn’t moving faster, especially as other countries push ahead at scale.
On the date of publication, Caleb Naysmith did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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