The robots were doing practice runs.
It was the day before production was set to begin, and every few seconds, machines folded a stack of paper-thin battery cells into a metallic sheath. Then they sealed the pouch around the edges.
This tightly choreographed assembly line is the result of yearslong American efforts to match China’s industrial policy in areas like battery manufacturing. Ultimately, the batteries produced at this Michigan factory by LG Energy Solution, a South Korean company, will help balance the supply and demand for power on U.S. electric grids.
The silver-colored pouches — roughly the size of two computer keyboards set end to end — will be placed into large battery containers that can be more than 20 feet wide. In the last few years, electric utilities and other energy companies have begun spending billions of dollars to install scores of such big batteries around the country in parking lots, at old industrial sites and on what used to be farmland.
The batteries play an increasingly central role in the electricity business, especially in states like California and Texas, which have lots of solar and wind farms that produce energy only some of the time. The batteries serve as a sponge, soaking up energy when a lot of it is available and dispensing it when homes and businesses need it most.
But President Trump’s tariffs on China may knock this fledgling industry off course. Another threat is brewing in Congress, where House Republicans, with Mr. Trump’s blessing, have passed a budget bill that analysts say would drastically restrict access to subsidies for making and using rechargeable batteries.
Tristan Doherty, chief product officer for LG Energy Solution’s U.S. energy storage unit, Vertech, compared tariffs to a drug that can be deadly at high concentrations.
“The dose makes the poison, right?” Mr. Doherty said during a recent visit to the LG factory in Holland, Mich. “A little bit of tariff metered out on the right time scale, at the right level, can get us to a much better place. But too much too fast can kill us.”
What happens to the companies that make batteries and install them on American grids will affect how quickly the country is able to meet rising power demand and how much that energy will cost.
Without such batteries, utilities would have to invest a lot more in expensive power plants and transmission lines to be prepared for scorching summer afternoons or frigid winter mornings when power use soars. Such spending would drive up electricity prices significantly, energy experts say.
Mr. Trump’s tariffs on China have already caused battery costs to rise sharply for U.S. buyers. When U.S. tariffs on Chinese batteries topped 150 percent for a monthlong period starting in April, companies stopped importing cells from China, executives said.
LG has made batteries for vehicles at its Michigan factory for more than a decade. At the beginning of May, the plant also began making batteries typically used to store energy. The storage batteries use iron and phosphate and go by the name LFP. China makes nearly all LFP batteries.
Most U.S. electric cars, by contrast, use batteries made up of materials like nickel and cobalt, which are more expensive than iron and phosphate but can store more energy, enabling cars to travel several hundred miles on a charge.
The Trump administration temporarily lowered tariffs on China in mid-May, to 30 percent, though batteries face additional levies. But the legislation that Republicans advanced would also make it harder to claim lucrative subsidies for making and installing batteries.
If the Republican budget bill took effect in its current form, it would be “something of a kill switch” for the tax credits available for making batteries, said Antoine Vagneur-Jones, an analyst at BloombergNEF. It also would quickly end tax credits for installing them on the grid.
Businesses are worried. Tesla, which sells energy storage systems in addition to cars, warned in April that the levies would have an “outsized” effect on its energy business, which relies on Chinese batteries. That was before Mr. Trump partly rolled back tariffs on China for 90 days.
This month, Fluence Energy, a company in Arlington, Va., that buys, packages and installs energy storage batteries, lowered its annual revenue forecast by around 20 percent, saying it was delaying projects and putting off new contracts because of unpredictable U.S. trade policy.
“It’s not the absolute price that’s so much the issue as it’s the uncertainty around where the price will be,” said John Zahurancik, the company’s president of the Americas.
Mr. Trump and his aides have expressed strong opinions about the energy sector. They love oil, gas and critical minerals but have dim views of electric vehicles and wind and solar energy. Batteries appear to occupy something of a middle ground.
Chris Wright, the energy secretary, seemed ambivalent about them in a March interview with The New York Times. “Batteries have a role. Solar is growing rapidly,” he said. “These are things of interest. I think we’re just a little bit more sober about it.”
Asked for comment for this article, the Trump administration did not directly address batteries but criticized wind and solar energy.
“The wind and solar industries in the United States have lived on more than three decades of subsidies,” an administration spokesman said. “Despite those subsidies, those energy sources still don’t come close to the affordability, reliability and security found in other sources of energy such as nuclear, coal and natural gas.”
The science behind LFP batteries was developed in the 1990s by researchers at the University of Texas at Austin. But it was China that recognized the technology’s commercial promise. Most manufacturers in the United States make batteries with nickel and cobalt.
“For a long time, we were not paying too much attention here in the U.S.,” said Arumugam Manthiram, a University of Texas engineering professor whose research helped pave the way for LFP batteries.
One company, A123 Systems, briefly produced LFP batteries in the United States, only to file for bankruptcy protection in 2012. A Chinese automotive supplier eventually bought most of the company’s assets.
Around that time, the company now known as LG Energy Solution, one of the world’s biggest battery manufacturers, began making cells for cars in Holland. Its light gray factory is less than 10 miles from Lake Michigan.
LG had planned to expand the factory to supply Toyota’s vehicles. But electric vehicles are not taking off as quickly in the United States as many companies anticipated. Electricity demand, on the other hand, is rising rapidly. As a result, the company changed its expansion plan and outfitted a new wing of the factory for LFP production, a $1.4 billion undertaking.
When the new assembly lines are running at full tilt, they will make enough cells to satisfy more than a quarter of current U.S. demand for LFP batteries, according to data from LG and Benchmark Mineral Intelligence, a research firm. The investment decision predated Mr. Trump’s trade policy announcements, Mr. Doherty said.
“There was already an understanding that the cost of importing cells from China was going to be going up,” he said, citing Biden-era tax and trade policy aimed at encouraging companies to buy U.S.-made batteries.
Another company, AESC, also started making LFP batteries for storage systems this spring, in Tennessee.
During the recent tour of the LG factory, operators were adjusting a machine designed to wind giant sheets of aluminum foil, like thread around a bobbin. The foil was coated on both sides in a thin layer of dark gray material containing iron and phosphate, the cathode. Machines would later press and slice that coated foil into strips to be paired with their other half, the anode.
While China remains the primary source for the components of LFP batteries, LG expects that its cells from Holland will not have any Chinese ingredients by early 2026, Mr. Doherty said. If successful, it would be the culmination of a long decoupling from a country that controls much of the supply chain for battery materials.
Still, the Republican tax bill remains a big concern. Without tax credits, it would not be profitable for LG to make cells in the United States at current battery prices, Mr. Doherty said.
“This all just creates more uncertainty,” he said. “Investment, especially big investment, hates uncertainty.”
Rebecca F. Elliott covers energy for The Times with a focus on how the industry is changing in the push to curb climate-warming emissions.
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