- Panasonic Says AI Expansion Rapidly Increases Demand for Data Center Battery Backups
- Customers have pre-committed 80% of Panasonic’s production capacity
- Panasonic Evaluates Kansas Plant to Support Additional Battery Production for Data Centers
The RAM crisis has persisted for some time, showing no signs of abating, and it’s now spreading to storage, with gaming PC makers warning that processors could be next.
As businesses struggle to cope with the impact of this crisis on planning cycles, the pressure is now extending to less visible parts of the data center stack.
Today, Panasonic says the demand for battery backups is growing rapidly, and it’s largely driven by the expansion of AI infrastructure that requires stable, continuous power.
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Batteries as critical infrastructure
Panasonic says it has already allocated about 80% of its planned production to existing customers, leaving only a limited share for new buyers trying to upgrade their systems.
Its batteries are designed to be installed in server racks, providing short periods of backup power that keep systems running during brief outages.
But this component is now emerging as a major bottleneck, as uninterrupted power is essential to avoid costly downtime and protect critical AI workloads.
As organizations expand their data center operations and add more servers, support systems such as backup power become increasingly difficult to secure in a predictable time frame.
That means buyers outside of existing supply agreements could find themselves competing for a limited share of batteries as growing demand for AI infrastructure strains production capacity.
To meet growing demand, Panasonic plans to roughly triple lithium-ion cell production in Japan and adapt parts of its automotive manufacturing lines to produce batteries for data centers.
The company is also evaluating whether its Kansas plant can support additional production for data center applications.
These developments reflect an effort to shift capacity toward compute-related demand as AI systems continue to develop.
Alongside batteries, the company is working on supercapacitors as an alternative form of backup power.
Unlike conventional capacitors which release energy almost instantly, supercapacitors store larger amounts and discharge more gradually.
Panasonic says these components will be used “to absorb fluctuations in electrical load,” with deliveries expected to begin in its 2027 fiscal year.
The company expects data center-related battery sales to reach 800 billion yen, or about $5 billion, by 2029, a figure that assumes continued growth in AI-related infrastructure.
However, meeting this demand depends on production increasing as planned, which remains uncertain given current supply pressures.
The situation suggests that infrastructure expansion faces limits beyond processing hardware – although the duration of these constraints and the ability of supply to adjust in time remains uncertain.
Via The register
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