From the battery industry chain to the power value chain, where is the new industrial position?
On September 24, CATL was added to the shareholder list of Units 3 and 4 of the CGN Lufeng Nuclear Power project.
According to the announcement by CGN Power, CATL holds a 5% stake through its subsidiary Zhaoqing Company, tying with Mingyang Smart Energy as the single largest private shareholder. The initial subscribed capital contribution is CNY 5 million, and the binding cumulative investment amount stipulated in the agreement reaches CNY 570 million.
This investment comes precisely at the intersection of two significant shifts in the nuclear power industry.
On one hand, nuclear power is accelerating its opening to private capital.
From Geely's 2% stake in the first phase of the Sanao Nuclear Power project in 2020, to the planned introduction of 30% private capital in the third phase of Sanao this year, automobile, battery, energy equipment, and material manufacturing companies have successively entered the shareholder list of nuclear power projects.
On the other hand, the operating environment for nuclear power is also changing.
As electricity spot markets are progressively launched and wind and solar renewable energy fully participate in market trading, electricity prices are increasingly influenced by real-time supply and demand, placing downward pressure on medium- to long-term contract electricity prices.
With an increasing amount of nuclear power entering the market, the originally relatively stable electricity sales revenue has begun to be affected by trading price fluctuations. Stable power generation no longer means equally stable returns.
How to sell electricity effectively has become a more practical operational challenge for nuclear power enterprises.
The rapid regulation capability of energy storage perfectly complements the stable and continuous output of nuclear power. As the proportion of market-oriented trading for nuclear power increases, nuclear-storage complementarity is entering a stage that considers electricity trading and operational returns.
CATL is not only a manufacturing enterprise that consumes a massive amount of electricity but also an energy storage system supplier and energy storage project investor.
As early as 2021, CATL had already participated in the exploration of nuclear-storage complementarity project development; subsequently, it has successively entered investments in non-fossil energy projects such as hydropower and nuclear power.
As nuclear power needs to adapt to the new electricity market and manufacturing enterprises begin to place greater emphasis on long-term low-carbon energy supply, CATL stands simultaneously at both ends of electricity demand and energy storage supply.
This also gives this 5% nuclear power investment a richer space for industrial observation than a mere financial stake.
From 2% to 30% Geely Has Already Purchased Over 600 Million kWh of Electricity
In 2020, the first phase of the Zhejiang Sanao Nuclear Power project, led by CGN, introduced private capital for the first time.
At that time, local governments searched everywhere for investors, yet few enterprises were willing to participate. Ultimately, after more than half a month of internal discussion, Geely decided to invest.
By the time private capital was introduced for the second phase of the Sanao Nuclear Power project in 2024, 27 private enterprises had already voluntarily signed up.
Policies are also further opening up space.
In November 2025, the General Office of the State Council explicitly required that for nuclear power, hydropower, and other projects that require national approval and have certain returns, special feasibility studies on the participation of private capital should be conducted. For projects that meet the conditions, the shareholding ratio of private capital can exceed 10%.
In July 2026, the first phase of the Shandong Laiyang Nuclear Power project was approved, with private capital holding a total stake of 25%; the third phase plan for the Sanao Nuclear Power project disclosed in September plans to further increase this to 30%.
As the scope of capital access for nuclear power expands, the enthusiasm of private enterprises to participate in long-term energy investments is also increasing.
However, nuclear power projects have long construction cycles and huge capital requirements. Why are private enterprises willing to invest hundreds of millions of CNY to become minority shareholders without operational control?
Geely's experience provides a reference.
In April this year, Chen Shengjie, Chief Financial Officer of Geely Technology Group, reviewed the investment decision made back then.
Geely mainly calculated three accounts: the future annual electricity demand of over 10 billion kWh, the long-term investment returns of the nuclear power project, and the continuously increasing low-carbon requirements in overseas markets.
These considerations later found practical business applications.
Geely Technology has reached a procurement cooperation with CGN for the first phase of over 600 million kWh of electricity, and both parties are also exploring businesses such as source-grid-load-storage integration and new energy development.
Chen Shengjie stated frankly, "What private enterprises want is not special treatment, but opportunities; not just a percentage, but recognition."
This statement reveals the subtleties of private enterprises' participation in nuclear power.
While nuclear power is open to private capital, there are still thresholds for entry.
When selecting investors for the second phase of the Sanao Nuclear Power project, CGN conducted prudent investigations into the enterprises' shareholder backgrounds, capital contribution capabilities, and contract performance capabilities. When finalizing the shareholders, they also considered the continuity of equity and the cooperation prospects in the energy sector.
Although Geely only holds a 2% equity stake, the cooperation between the two parties has already extended to actual electricity procurement.
For large manufacturing enterprises, the value of nuclear power investment may be reflected not only in long-term asset returns but also in energy procurement and industrial cooperation.
This provides a reference for understanding CATL's 5% stake.
It is particularly worth noting that CATL itself is also an energy storage enterprise.
Nuclear Power Sales Under Pressure
Is the Opportunity for Energy Storage Here?
The operating environment of nuclear power enterprises themselves is changing.
As electricity spot markets are progressively launched and wind and solar renewable energy fully participate in market trading, electricity prices are increasingly influenced by market supply and demand.
The electricity sales revenue of nuclear power is also increasingly affected by market price fluctuations.
CGN Power's 2026 semi-annual report disclosed that in the first half of the year, the proportion of market-oriented traded electricity to total on-grid electricity reached 65.9%, a year-on-year increase of about 9.8 percentage points.
Affected by the decline in electricity trading prices in some regions, the company's average settlement electricity price declined year-on-year.
How to sell electricity effectively has become a more practical operational challenge for nuclear power enterprises.
Energy storage thus gains new application space.
It is worth noting that nuclear-storage complementarity and wind-solar energy storage configuration differ in their application logic.
Wind and solar power generation are affected by weather and day-night cycles. When the wind is strong and sunlight is abundant, the generated electricity may not be fully consumed at the moment; when generation is insufficient, other power sources are needed for supplementation. Energy storage can store surplus electricity and release it when needed, reducing wind and solar curtailment.
Nuclear power is different.
The advantage of nuclear power is continuous and stable power generation, while the difficulty lies in the inability to frequently and significantly adjust output.
When power supply is abundant and market prices are low, nuclear power units still tend to operate stably; during peak electricity consumption, when electricity prices may be higher, nuclear power units find it difficult to rapidly increase power generation.
Energy storage can charge during low-price periods and discharge during high-price periods, shifting some electricity to be sold at higher-priced times, and can also generate revenue through services such as frequency regulation.
Nuclear-storage complementarity has two layers of value: reducing the regulation pressure on nuclear power units while increasing the flexibility to participate in electricity trading.
For nuclear power enterprises, energy storage provides the possibility to improve electricity trading returns; for energy storage enterprises, it means new project development and operational opportunities.
CATL has long participated in the exploration of this direction.
In November 2021, Huining Shidai, in which CATL holds a 51% stake, signed a cooperation agreement with CGN Power Sales Co., Ltd., proposing to carry out businesses such as nuclear-storage complementarity, peak shaving, frequency regulation, and shared energy storage.
In January 2022, the Jiangmen Taishan nuclear-storage complementarity project jointly invested by both parties completed its filing.
The planned scale of the project reaches 1.3GW/2.6GWh, with a total investment of approximately CNY 6 billion.
CGN Power Sales, which participated in the cooperation at that time, is itself involved in the sales of market-oriented nuclear power electricity. The cooperation between the two parties has already extended to large-scale energy storage project development and electricity market businesses.
In 2023, the project continued to advance with the positioning of independent energy storage, exploring participation in the electricity energy market, ancillary services, and dispatch operations.
In January this year, Huining Shidai signed another energy storage project of the same scale in Xinhui, Jiangmen, and received environmental impact assessment approval in February.
Meanwhile, CGN Power's 2025 annual report disclosed that it is conducting preliminary research on the comprehensive utilization of nuclear energy in areas such as energy storage technology and "nuclear power + computing power centers."
As the proportion of market-oriented trading for nuclear power increases, the rapid regulation capability of energy storage is undergoing new value validation.
And whether it can bring practical improvements to nuclear power operational returns will also determine in the future how large a market nuclear-storage complementarity can form.
Continuous Investments in Hydropower and Nuclear Power CATL's Zero-Carbon Power Ambition
In May 2025, when CATL was listed on the Hong Kong Stock Exchange, Zeng Yuqun proposed three development directions for the company:
Global zero-carbon transportation, global zero-carbon power, and global industrial new energy transformation.
Among these, in the zero-carbon power field, CATL has incorporated technologies such as power electronics, flexible regulation, and virtual power plants into its layout, and proposed building a new type of zero-carbon power system.
Today, this strategy is extending to the power source investment segment.
At the end of 2025, CATL participated in the investment of the Danba Hydropower Station on the Dadu River in Sichuan, holding a 10% stake. The total investment of the project is CNY 15.273 billion. Calculated according to a 30% capital ratio, CATL's corresponding project capital is approximately CNY 458 million, and the projected internal rate of return on capital for the project is 5.95%.
In September 2026, CATL entered the CGN Lufeng Nuclear Power project with a proposed shareholding ratio of 5%.
In less than a year, CATL has successively participated in hydropower and nuclear power project investments, beginning to allocate capital to the non-fossil energy supply side.
In these two investments, even though CATL participates as a minority shareholder, this shift in investment direction is noteworthy for a battery industry leader.
In the new power system, CATL is in a unique industrial position.
First, it is a large electricity consumer.
Electricity is a crucial production factor in battery manufacturing. Long-term electricity prices affect manufacturing costs, while the electricity consumption structure relates to the product's carbon footprint.
Low-carbon power sources represented by nuclear and hydropower have lower carbon emission intensities. Increasing the proportion of low-carbon electricity usage helps reduce carbon emissions in the battery manufacturing process and enhances the enterprise's ability to cope with overseas low-carbon supply chain requirements.
Second, CATL's energy storage business has extended from battery cells and systems to power station investments and virtual power plants. Now, with continuous stakes in hydropower and nuclear power, it is further directing funds to the power generation side.
This extends CATL's cooperation with large energy enterprises from energy storage products and project businesses to long-term capital cooperation.
It is taking the power industry as an important investment direction.
Behind this is a larger industrial shift.
The energy transition is changing the value composition of electricity. As the proportion of new energy power generation increases and power marketization reforms advance, power generation costs, power supply periods, regulation capabilities, and carbon emission attributes are all affecting the operational value of electricity.
Now, leading enterprises represented by CATL have begun to participate in broader power industry activities through energy storage project operations, non-fossil energy investments, and other means.
Battery enterprises are participating in two markets simultaneously. One is the manufacturing market centered on battery products, and the other is the energy market revolving around electricity production, regulation, and trading.
With continuous stakes in hydropower and nuclear power projects, CATL is shifting from the battery industry chain to the power value chain, seeking a new industrial position.