A Trump administration executive order issued Aug. 26 has frozen procurement decisions across more than 23 gigawatts of large-scale U.S. energy storage projects now in financing close or under construction, according to BloombergNEF analyst Isshu Kikuma.

The order declares a national security emergency over foreign-made grid equipment and bans "the acquisition, importation, transfer, or installation of any foreign-produced bulk-power system electric equipment." It applies to any transaction initiated on or after Aug. 26 and gives federal agencies retroactive authority to "identify, isolate, monitor, secure, disconnect, replace, or remove such equipment" already in service.

Which components are caught by the order?

The order names 24 foreign entities. China is the only one that supplies significant volumes of equipment to U.S. grid developers, said Keith Martin, an attorney with Norton Rose Fulbright. China manufactures roughly three-fifths of the lithium-ion batteries installed on U.S. grid projects today.

The text does not specify whether the ban reaches only the "smart" software and control systems that could expose batteries to remote tampering, or also the "dumb" cells and modules themselves. "If the broader interpretation prevails, the consequences would be staggering," Martin said.

What is the clock for clarity?

The Department of Energy has 120 days from Aug. 26 — until Dec. 24 — to issue rules defining what the order prohibits. "So we have this period through Christmas where we're facing this uncertainty," Martin said. "The simplest remedy for energy storage developers would be that if you haven't signed a contract to purchase Chinese equipment, don't do it."

Project sponsors have not stopped. Ravi Manghani, senior director of strategic sourcing at Anza Renewables, said: "The industry can't just stop while we're waiting for information to come out of the DOE." But "things have slowed down a bit, particularly on the energy storage side."

How much U.S. capacity is at risk?

Batteries have been one of the rare clean-energy sectors the administration has left alone until now. The Solar Energy Industries Association and Benchmark Mineral Intelligence reported 20.2 gigawatt-hours installed in the second quarter of 2026 — equal to 10% of the country's total energy storage fleet.

BNEF's Kikuma cautioned that damage assessments remain preliminary: "For now, it's too early to tell the exact volume of projects that might face delays or cancellations." The 23 GW figure covers projects already past financing close or in active construction.

What about inverters, transformers and switchgear?

The order also reaches inverters, transformers and switchgear, plus any "critical component, software, firmware, digital service, maintenance service, or remote-access capability" tied to the power system.

Imported transformers and switchgear — both in tight supply — mostly originate in Brazil, Canada, Germany, Mexico and South Korea, none of which sit on the order's 24-entity list. Chinese-owned factories in Southeast Asia and India, however, supplied about 40% of U.S. inverter imports in 2025, BNEF data show.

Developers had already begun pivoting to non-Chinese inverters under tariff pressure and the foreign entity of concern (FEOC) tax-credit rules. That shift accelerated after a separate July directive threatened to ban new inverters from all foreign sources, Manghani said.

What hedging options remain?

Martin pointed to a workaround: developers can source battery hardware and pair it with control electronics and communications gear built in the U.S. or in countries not named in the order. But separating "dumb" cells from "smart" software is not always possible. Some vendors lock control systems to their own batteries, blocking third-party substitutions.

The U.S. domestic battery manufacturing base is growing fast but cannot yet match Chinese pricing or output. China supplies roughly 80% of the world's lithium-ion cells.

What happens next?

The 2020 version of this ban triggered "panic in the market" before the Biden administration revoked it in 2021. DOE officials have since documented how a broad prohibition can threaten grid reliability and electricity affordability, Martin said.

The administration faces a separate tension: data-center load growth has lifted demand for new generation, while fossil-gas plant construction timelines stretch into the early 2030s. "There is no clear alternative to solar, wind, and storage" before the end of the president's term, Martin said.

DOE rulemaking closes Dec. 24. Until then, every unsigned battery supply contract sits in a holding pattern.