$TSLA Investors Eye Grid Security Order as Potential Boost for Energy Storage Business

President Trump declared a national emergency and signed an executive order on Aug. 26 aimed at keeping foreign-made equipment off the U.S. power grid, covering transformers, inverters, battery storage, circuit breakers, generators, and turbines, citing cybersecurity and sabotage risks. The Department of Energy has up to 180 days to specify which countries and products are covered.
Analysts see Tesla's Energy Generation and Storage segment, its fastest-growing major business, as a potential beneficiary, since it's one of few U.S. companies with an at-scale grid battery storage product. RBC's sum-of-the-parts model assigns 15% of Tesla's valuation to Megapack storage, versus 52% for Robotaxis, 27% for full self-driving, and just 6% for the core car business. UBS projected 15.1 gigawatt-hours of storage deployment in Q1 alone, up 45% year over year, and Tesla signed a 25-gigawatt-hour Megapack supply deal with NatPower ahead of Q2 earnings.
However, Tesla has reportedly committed to sourcing at least 20 gigawatt-hours of battery cells from China's CATL for stationary storage between 2026 and 2028, about 30% of its projected cell needs, complicating a clean domestic-sourcing narrative.
Tesla shares are down nearly 18% in 2026 and remain about 26% below their all-time high of $498.83 set in December 2025. Q2 revenue rose 26% year over year to a record $28.24 billion, but free cash flow turned negative $1.09 billion, versus positive $146 million a year earlier, while capital expenditures jumped 142% to $5.79 billion.