LONDON, Tuesday, June 23, 2026: NatPower and Tesla confirmed on Tuesday that they have signed a multi year agreement to build 25 gigawatt hours (GWh) of battery storage across Italy and Britain, the opening phase of a programme the two companies say could ultimately be worth up to $5 billion, according to Reuters. For grid operators racing to absorb Europe’s growing share of wind and solar power, and for Tesla investors watching its energy division wobble after a record 2025, this is the moment one of the continent’s largest battery storage commitments of the year became real.
- What the NatPower Tesla Deal Confirmed on Tuesday
- Inside the Agreement: Locations, Phases and Numbers
- The Technology Powering the Deal
- NatPower CEO Fabrizio Zago on Why This Partnership Exists
- Who Is NatPower? Inside the Company Behind the Deal
- Why Italy and the UK Came First
- A Pattern, Not a One Off: Tesla’s Other European Megapack Deals
- Europe’s Battery Storage Boom, in Numbers
- Tesla’s Energy Division: The Other Side of the Deal
- Market Reaction: Tesla Shares Slip Despite the News
- What Remains Unverified or Inconsistent
- What This Means for Investors, Grid Operators and Tesla Watchers
- Frequently Asked Questions
What the NatPower Tesla Deal Confirmed on Tuesday
The NatPower Tesla deal was confirmed in statements from both companies on Tuesday, with Reuters reporting that the agreement covers 25 GWh of battery storage across five initial projects in Italy and Britain. The Tesla NatPower partnership is one of the largest battery storage commitments announced in Europe this year.
This is the first phase of a much larger programme. The companies told Reuters the full plan is designed to eventually exceed 100 GWh of storage capacity, well beyond what is being built right now. The Tesla battery storage deal is built to scale well past its initial five-project phase, the companies said.
Construction on the first phase alone will cost between $4 billion and $5 billion, according to figures the companies gave to Reuters. They also said the projects could generate more than $15 billion in revenue over 20 years. Over its 20-year horizon, the Tesla energy storage partnership is projected to generate more than $15 billion in revenue, according to the companies.
NatPower’s own website corroborates the core terms. A notice on the company’s homepage describes a multi year supply and execution agreement with Tesla covering more than 25 GWh of battery energy storage, language that matches the Reuters account.
Inside the Agreement: Locations, Phases and Numbers
Reuters journalists Simon Jessop and Susanna Twidale broke the story, reporting that NatPower will use Tesla’s Megapack battery system across the five projects that make up the first 25 GWh phase.
Neither company has named the specific towns or grid connection points where those five projects will sit. Neither has said how the 25 GWh splits between the Italian and British portions of the programme.
What is clear is the scale of ambition once the first phase is built out. A jump from 25 GWh to more than 100 GWh would roughly quadruple the storage capacity covered under this single agreement.
The $15 billion revenue figure spans two decades, not a single year. Neither company has published the assumptions behind that number, such as expected electricity prices or trading margins.
The Technology Powering the Deal
Two pieces of Tesla’s energy business sit at the center of this agreement. The first is Megapack, Tesla’s utility scale battery, which the company describes on its own product page as a way to stabilize grids and prevent outages.
The second is software, not hardware. Reuters described it as Tesla’s trading technology, a system that manages when to buy and sell electricity on wholesale power markets.
That second piece is arguably the more valuable one. A battery only makes money if it charges when power is cheap and discharges when power is expensive or the grid needs support, and getting that timing right is a software problem as much as an engineering one.
Tesla has been expanding its hardware lineup quickly. The company unveiled Megapack 3 and a companion product called Megablock, which pre integrates four Megapack 3 units with a transformer and switchgear, at an event in Las Vegas in September 2025, according to Electrek’s coverage of the launch.
Tesla said at the time that Megapack 3 would be built at a new factory near Houston with roughly 50 GWh of annual capacity, adding to existing production in Lathrop, California, and Shanghai, Electrek reported.
Tesla is not without competition here. Electrek noted that Tesla’s own battery cell suppliers, BYD and CATL, each sell rival grid scale storage systems, putting Tesla in the unusual position of competing against companies it also buys from.
NatPower CEO Fabrizio Zago on Why This Partnership Exists
NatPower Group CEO Fabrizio Zago framed the deal as a fix for a problem he sees across the renewable sector. The industry generally has enough technology and capital, he told Reuters, but it routinely struggles to deliver projects on schedule.
What NatPower and Tesla have built together, Zago said, is “an ecosystem that enables alignment between capital and execution.” He told Reuters he believes the model can be replicated across multiple markets.
Zago has spent more than two decades in renewable energy. He previously served as chairman and CEO of Building Energy Group, an international independent power producer, according to his biography published on NatPower’s UK website.
His public remarks have repeatedly centered on long duration storage as a strategic priority for NatPower, including comments referenced on his LinkedIn page from an appearance at the FT Live Energy Transition Summit.
Who Is NatPower? Inside the Company Behind the Deal
NatPower describes itself as an independent energy company developing renewable infrastructure, including solar, wind, hydrogen and battery storage projects. The company is headquartered in Luxembourg, according to its official “Our Team” page.
It also maintains offices in Milan, London, Washington, D.C., and Almaty, Kazakhstan, the same company page states.
Beyond Zago, NatPower’s leadership includes Almanio Romano as Managing Director and Group CFO, Andrea Minerdo as Chief Corporate Officer, and Davide Bocciarelli as Chief Operating Officer, according to the company’s website.
NatPower has separately said it holds a global development pipeline of 35 GW across all of its technologies, with more than 1 GW of renewable projects already completed, according to comments Zago gave in an interview with Italian outlet ADNKronos. Those figures describe the company’s broader portfolio and predate Tuesday’s announcement; they are not specific to the battery storage programme with Tesla.
Why Italy and the UK Came First
NatPower has been actively bidding into long duration storage auctions in both countries well before Tuesday’s announcement. The company said through its corporate LinkedIn account that one of its projects, Project Scara, was awarded 250 megawatt hours of storage capacity under Terna’s MACSE auction, the Italian grid operator’s mechanism for procuring long duration storage.
In the UK, NatPower has stated on LinkedIn that it submitted all ten of its Long Duration Energy Storage bids for the British power system, describing the category as a major opportunity for the grid.
Britain’s own market data backs up why storage developers are circling. The IEA’s Electricity 2026 report found that the ratio of installed utility scale battery storage to peak electricity load in the UK reached around 15% in 2024, up from less than 5% in 2019.
The IEA grouped the UK alongside California, Germany, South Australia and Texas as among the world’s most robust utility scale battery markets in that same report.
A Pattern, Not a One Off: Tesla’s Other European Megapack Deals
The NatPower agreement is not Tesla’s first large European storage order, and it fits a pattern that has built over the past year.
Engineering and services group SPIE announced a three year European framework agreement with Tesla in mid December 2025 to deploy Megapack based battery storage systems across multiple countries, standardising legal and operational terms for future projects, according to Yahoo Finance’s coverage of the announcement.
Tesla also secured a 1 GWh Megapack contract with Matrix Renewables for a project in Eccles, Scotland, using a 500 megawatt, two hour standalone battery system, Nasdaq reported. It marked Matrix Renewables’ first standalone battery storage project in the UK, according to the same report.
Set against that backdrop, the NatPower deal is the largest single European commitment in Tesla’s recent run of Megapack contracts, both in capacity and in headline dollar value.
Europe’s Battery Storage Boom, in Numbers
This deal lands in the middle of the fastest stretch of battery storage growth Europe has ever recorded.
The European Union added 27.1 GWh of new storage capacity in 2025, a 45% jump from 2024 and a fresh annual record, according to a report published by trade association SolarPower Europe on January 28, 2026.
That pushed the EU’s total installed capacity to 77.3 GWh, up from less than 8 GWh at the end of 2021, roughly a tenfold increase in four years, the same report found.
For the first time, large grid connected batteries made up the majority of new capacity added in a single year, at 55%, marking a shift away from the residential heavy market of prior years, according to Solar Power Europe.
Globally, the trend is just as steep. The International Energy Agency’s Global Energy Review 2026 found that 108 GW of new battery storage capacity was deployed worldwide in 2025, 40% more than in 2024, leaving installed capacity eleven times higher than in 2021.
The IEA also reported that lithium iron phosphate chemistry, the type used in most grid scale batteries including Tesla’s Megapack line, now accounts for roughly 90% of global deployments, up from under half just five years earlier.
A separate IEA report, Electricity 2026, put global utility scale battery capacity at more than 12 times its 2020 level by 2024. The same report flagged the structural problems deals like this one are designed to solve: multi year delays in securing grid connections and permits, volatile revenue streams, and difficulty accessing affordable financing.
The IEA also warned that battery supply chains remain heavily concentrated in China, a concentration risk it said calls for more diversified manufacturing globally.
Closer to the two markets in this deal, the IEA’s separate commentary on 2025 storage trends found that European battery additions overall dipped slightly from 2024, to about 6.2 GW, while utility scale additions, the category NatPower’s projects fall into, more than doubled to roughly 4.6 GW.
The supply chain behind all of this is scaling just as fast. Global shipments of energy storage cells reached 612.39 GWh in 2025, nearly double the year before, with shipments forecast to hit 801 GWh in 2026, according to data from research firm InfoLink cited by Energy Industry Review.
Tesla’s Energy Division: The Other Side of the Deal
For Tesla, this agreement arrives as its energy storage business has cooled after a record 2025.
Tesla deployed 46.7 GWh of energy storage in 2025, up from 31.4 GWh in 2024, according to the company’s own fourth quarter shareholder update filed with the U.S. Securities and Exchange Commission.
The fourth quarter alone accounted for a record 14.2 GWh. Full year energy generation and storage revenue reached $12.8 billion, a 26.6% increase year over year, Tesla CFO Vaibhav Taneja told investors on the company’s Q4 earnings call, as reported by Utility Dive.
That momentum slowed sharply in the first quarter of 2026. Tesla deployed 8.8 GWh of storage products in Q1, down 38% from the Q4 2025 record and 15% below the 10.4 GWh deployed in the first quarter of 2025, according to Tesla’s own SEC filing for the period.
Energy generation and storage revenue fell 12% year over year to $2.41 billion in that same quarter, per the filing.
Taneja told investors on the April 22 earnings call that full year 2026 storage deployments are still expected to come in higher than 2025, according to Energy Storage. News’ reporting on the call.
A five project, 25 GWh European order, even one spread across several years, represents a meaningful chunk of forward demand for Tesla’s Megapack line at a moment when its own quarterly deployment figures have been inconsistent.
Market Reaction: Tesla Shares Slip Despite the News
Tesla shares fell 3.3% in pre market trading on Tuesday despite the announcement, according to Tip Ranks.
TipRanks reported that the drop coincided with separate news that a ransomware group calling itself World Leaks had leaked confidential documents and trade secrets potentially affecting both Apple and Tesla, suggesting the battery storage deal was not the cause of the move.
TipRanks also reported that Tesla carries a “Moderate Buy” consensus rating, based on 11 buy ratings, 15 hold ratings and three sell ratings among the analysts it tracks, with an average price target of $403.49 as of Tuesday.
What Remains Unverified or Inconsistent
In the interest of accuracy, several details connected to this story have not been independently confirmed by either company and are flagged here rather than stated as settled fact.
The exact split of the 25 GWh between Italy and the UK has not been disclosed by NatPower or Tesla.
The specific sites or grid connection points for the five initial projects have not been named in either company’s public statements.
No construction start date or completion timeline has been published for the first phase.
Tesla has not issued its own standalone press release on the agreement separate from the joint comments reported by Reuters; this report relies on the Reuters account and NatPower’s own website notice to confirm the deal and its scope.
The methodology behind the $15 billion, 20 year revenue projection has not been made public by either company, so that figure should be treated as a company estimate rather than an audited forecast.
What This Means for Investors, Grid Operators and Tesla Watchers
Strip away Tuesday’s headline number, and three threads matter more than any single contract for anyone with exposure to this market.
The first is that NatPower’s CEO has identified the real bottleneck in European storage build out, and it isn’t money. Zago told Reuters the sector already has access to capital and technology; what it lacks is consistent execution. Pairing a single battery vendor with a single trading software provider is a direct answer to that specific problem, and other developers will likely watch whether the model actually shortens construction timelines before copying it.
The second is that this deal is a stress test for Tesla’s energy division at an awkward moment. Storage deployments fell 38% quarter over quarter in Q1 2026, and a 25 GWh order with room to grow past 100 GWh gives Tesla a multi year demand anchor right when its own numbers have turned uneven.
The third is that the financial promise here, more than $15 billion over 20 years, is unverifiable today and will stay that way for years. What can be tracked starting now are concrete, checkable milestones: whether NatPower names the five project sites, whether construction timelines get published, and whether Tesla’s Q2 and Q3 2026 deployment figures show this kind of European order book translating into shipped Megapacks.
Frequently Asked Questions
1. What is the NatPower Tesla deal and how much is it worth?
NatPower and Tesla signed a multi year agreement to build 25 GWh of battery storage in Italy and Britain, the first phase of a programme the companies say could be worth up to $5 billion to build, with a broader target of more than 100 GWh, according to Reuters. The companies also said the projects could generate over $15 billion in revenue over 20 years.
2. What technology will NatPower use under the Tesla agreement?
NatPower will deploy Tesla’s Megapack utility scale battery system along with Tesla’s electricity trading software, which manages when to buy and sell power on wholesale markets, according to Reuters’ reporting on the deal.
3. What is NatPower, and who is its CEO?
NatPower is an independent energy company headquartered in Luxembourg that develops renewable infrastructure, including solar, wind, hydrogen and battery storage, according to its own website. Fabrizio Zago is NatPower’s Group CEO; he told Reuters the Tesla partnership creates an ecosystem that aligns capital with execution, addressing the renewable sector’s chronic struggle to deliver infrastructure projects on time.
4. Did the NatPower Tesla deal affect Tesla’s stock price?
Tesla shares fell 3.3% in pre market trading on the day the deal was announced, but Tip Ranks attributed the decline to separate reports of a ransomware leak affecting Tesla and Apple rather than to the NatPower announcement itself.
5. How big is the battery storage market in Europe right now?
The European Union added a record 27.1 GWh of new storage capacity in 2025, a 45% increase over 2024, according to Solar Power Europe, with utility scale batteries, the category this deal falls into, accounting for the majority of new capacity for the first time.
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Isabella is a global business journalist and former McKinsey analyst from Brazil. She brings sharp insights on economic shifts, policies, and founder journeys from around the world.
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